Tesla's energy storage plant in eastern Shanghai's Lin-gang Special Area broke ground on Thursday, marking a major progress forward of this facility - the US electric carmaker's first of such facility outside its home country.

Covering some 200,000 square meters, Tesla's new energy storage project is expected to enter mass production in the first quarter of 2025.

The plant is set to produce 10,000 Megapack units — advanced battery systems designed for large-scale energy projects — annually, which translates into nearly 40 gigawatt-hours of energy storage capacity.

Each Megapack can store more than 3 megawatt-hours each. Together, they are set to provide essential energy storage and grid support.

The new plant obtained construction permit on May 13. It only took one month's time from negotiation to reaching an agreement between Tesla and Lin-gang, Wu Xiaohua, deputy-secretary of the Party working committee of Lin-gang Special Area said during the groundbreaking ceremony on Thursday.

"It is our hope that Tesla's new mega factory will serve as an icon, helping Lin-gang to grow into a hub for world-leading companies, an internationally influential highland for industrial innovation and a demonstration zone for green transformation and low-carbon development," said Wu.

During an online speech, Tesla's senior vice-president Mike Snyder said that the megapack system can meet the diversified energy demands from customers from all over the world, facilitating the world's green energy development.

The total investment of Tesla's energy storage plant in Lin-gang will require a total investment of 1.45 billion yuan ($200 million).

The State-owned commercial conglomerate Lingang Group reached an agreement with Tesla on Thursday to introduce the latter's Megapack system, which will be the first batch of ultra-large electrochemical commercial energy storage systems to be introduced in China.