Imagine coming home to a house that not only stores your solar power but also teams up with neighbors’ homes to ease pressure on the local grid. That idea drives Lunar Energy, a California company quietly reshaping how we think about home batteries. Founded six years ago by Kunal Girotra, who once led energy efforts at Tesla Inc. (NASDAQ: TSLA), Lunar Energy focuses on software that makes ordinary home batteries smarter.
Girotra left Tesla around 2020 to start this venture, spotting a gap in how batteries interact with the grid. His software tells batteries when to soak up cheap electricity, often from solar or wind during off-peak hours, and when to send it back out during evening spikes. Last year, Lunar began selling its own batteries through partners, reaching about 2,000 homes in California so far. These systems help owners cut bills and even earn cash by participating in grid programs.
Now, the company has fresh capital to grow. It raised $102 million in a Series D round, led by B Capital and Prelude Ventures, plus a $130 million Series C that had not been public before. That totals over $230 million, fueling plans to enter Texas, Puerto Rico, and Hawaii. Girotra hints at nearing a $1 billion valuation, though he keeps exact numbers close. This cash will ramp up sales and refine the tech that lets groups of home batteries act like a single large power plant.Â
What sets Lunar apart lies in its virtual power plants. Picture thousands of home batteries linking up to balance electricity supply and demand across a neighborhood or city. Since 2022, Lunar has coordinated nearly 2 gigawatt-hours of capacity, enough to supply daily power for about 68,000 U.S. homes. Homeowners in the program average $464 a year from utilities buying back their excess energy. The software already works with utilities in Japan, parts of Europe, and twelve U.S. states, with more expansion ahead.
This push comes as U.S. grids face growing strain from extreme weather, electric vehicles, and data centers. California and Texas lead the charge, with blackouts and heat waves pushing demand for backup power. Federal incentives like the Inflation Reduction Act offer 30% tax credits for storage, spurring installs. In 2025, residential storage hit record levels, with states like Arizona joining California and Texas to account for most growth.
The U.S. home energy storage market reflects this urgency. It reached $1.05 billion in 2025 and could hit $2.40 billion by 2034, growing at 9.60% annually. Another estimate pegs residential solar-tied storage at $8.09 billion last year, eyeing $38.50 billion by 2033 with 21.54% yearly gains. Overall energy storage capacity stood at 67.53 gigawatts in 2026, projected to quadruple to 194.88 gigawatts by 2031 at 23.61% CAGR. Lithium-ion batteries dominate, prized for density and dropping costs, while systems from 10 to 20 kilowatt-hours fit most homes.
Single-family homes drive 55% of demand, fueled by solar pairings and outage fears. California holds sway through programs like SGIP, but Texas thrives on market rules letting storage profit from price swings. Puerto Rico, hit hard by hurricanes, craves resilient setups, aligning with Lunar’s expansion. Nationally, installs jumped 42% in 2025 for retrofits on existing solar roofs. North America claimed 45% of global share in 2024, backed by policy and tech from players like Tesla’s Powerwall.
Yet challenges persist. Upfront costs deter some, even with incentives, and grid operators must adapt to distributed power flows. Software like Lunar’s bridges this by turning homes into flexible assets. Utilities gain stability without massive new plants, while owners offset EV charging or air conditioning peaks.
Lunar’s model hints at a shift. Instead of isolated backups, home batteries join utility networks, earning revenue and cutting waste. In Japan and Europe, similar programs already pay households for grid support. U.S. states experiment too, with twelve using Lunar now. As batteries get cheaper, expect more homes to join, especially with AI optimizing flows.
Texas offers a test bed, its deregulated market rewarding peak-time dispatch. Hawaii, reliant on imports, seeks storage to blend renewables. Puerto Rico rebuilds post-storms with microgrids in mind. Lunar’s entry could accelerate this, proving software scales across climates and rules.
Girotra’s Tesla background brings credibility. There, he tackled scaling energy products amid grid demands. Now, Lunar builds on that, prioritizing software over hardware alone. Distributors handle battery installs, letting Lunar focus on coordination brains.
Home storage fits larger trends. Renewables hit 20% of U.S. power in 2025, but intermittency demands storage. EVs add load, yet their batteries could double as home backups. Federal goals aim for 10 million clean homes by 2030, blending efficiency and storage.
Lunar Energy arrives at a tipping point. With funding secured and markets opening, it could redefine home batteries as grid partners. U.S. growth shows no signs of slowing, as costs fall and needs rise. For business readers eyeing energy shifts, this startup offers a window into tomorrow’s power networks, where every home plays a part.
