LG Energy Solution accelerates its penetration of the U.S. market, the fastest growing global energy storage system (ESS) market.
LG Energy Solution participated in "Re+ 2023," the largest renewable ESS exhibition in the U.S., held in Las Vegas from September 11 to 14 (local time), announcing four key business strategies to secure competitiveness in the ESS market and showcasing its latest ESS products and technologies, including modular water-cooled container products for power grids with LFP cells.
"Based on our proven production capacity and differentiated ESS technology competitiveness, we will more than triple our sales in the ESS business within five years," said Seung-se Jang, Executive Director of LG Energy Solution's ESS Division. "We decided to invest KRW 3 trillion in a new LFP battery production plant in Arizona earlier this year to focus on the U.S. market, which is expected to see the steepest growth, and more investments will be made in the future.
The global ESS market is expected to grow rapidly as policy support from governments expands. The U.S. market in particular is expected to drive this growth, thanks to the Inflation Reduction Act (IRA).
According to energy research firm Wood Mackenzie, the North American ESS market is expected to grow nearly 10 times, from 12 GWh in 2022 to 103 GWh in 2030.
LG Energy Solution plans to take the lead in the U.S. market with four core business strategies: operating a large-scale production plant in the U.S., strengthening the local supply chain system, differentiated LFP battery technology, and system integration (SI) capabilities.
First, the company plans to expand strategic partnerships with local customers in the U.S. through the Arizona plant, which is the first large-scale battery production plant dedicated to ESS in the country. The 16GWh plant, which will be built with a total investment of KRW 3 trillion, will produce LG Energy Solution's independently developed pouch-type LFP batteries. Construction is set to begin this year and mass production is targeted for 2026.
In addition, the company will further strengthen the local supply chain system for key raw materials and components used in battery cell production, packs, and containers. Through this, LG Energy Solution will actively cooperate with its customers to help them take advantage of the IRA tax credit.
Expanding its product portfolio with more advanced LFP battery technology with higher reliability, efficiency, and longer lifespan. With the only LFP battery production plant for ESS in the U.S., LG Energy Solution will enhance customer value by providing immediate management services to meet customer needs.
Strengthening ESS SI capabilities LG Energy Solution plans to strengthen its system integration solution business capabilities that cover the entire ESS, including ESS supply, business planning, design, installation, maintenance, and repair. It also plans to expand its business to software services that enable real-time monitoring and predictive maintenance. Last year, LG Energy Solution established LG Energy Solution Vertech. Inc, a U.S. ESS SI company.
Meanwhile, this year's "RE+ 2023" event attracted more than 1,300 major renewable and ESS-related companies from around the world. LG Energy Solution organized its exhibition booth into North American Network Zone, Power Grid Zone, Residential Zone, and Commercial Zone to showcase its modular type water-cooled container products for power grids with LFP cells with a capacity of 4.76 MWh.
