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LG Energy inks deal with Excelsior Energy Capital worth an estimated $1.4B

Published: 20 Dec. 2024, 16:17 Updated: 20 Dec. 2024, 16:24

SARAH CHEA
[email protected]

LG Energy Solution's battery product for energy storage system [LG ENERGY SOLUTION]

LG Energy Solution sealed another energy storage systems (ESS) deal with Excelsior Energy Capital, a Minnesota-based renewable energy infrastructure investor, in a pact potentially worth up to 2 trillion won ($1.4 billion).

The Korean battery maker on Friday said it will supply 7.5 gigawatt-hours of batteries for ESS under the deal, with the deal due to start in 2026.

That is equivalent to the electricity to power 750,000 households with four family members a day. Although neither of the two companies has confirmed the value of the deal, considering that the battery system for an ESS costs between $170 to $200 per kilowatt hour, the deal could be worth nearly 2 trillion won.

LG Energy Solution said it will supply container products based on its high-quality lithium iron phosphate batteries, which boast higher energy density and improved performance and safety. Flexible design is also available through its modular design.

Founded in 2017, Excelsior Energy Capital is a renewable energy infrastructure fund focused on middle-market investments in wind, solar and battery storage plants, and businesses across North America. It has investing portfolios in various renewable energy projects in the United States including in California, Colorado and Tennessee.

ESS is an area where global battery manufacturers turn their eyes to amid the slumping demand for EVs.

An ESS improves grid stability by storing excess energy and releasing it when demand rises. It is therefore considered crucial in increasing the efficiency of renewable energy plants. The demand for ESS is growing as companies scramble to install solar panels to generate electricity even during power outages and the demand for data centers rises with the spreading application of AI.

The U.S. ESS market, which totaled around $8 billion this year, is expected to jump 140 percent to $18.7 billion by 2030.

LG Energy Solution in October inked an 8 gigawatt-hour ESS battery deal with New York's Terra-Gen Power Holdings II and a 4.8 gigawatt-hour deal with Hanwha Q Cells.

BY SARAH CHEA [[email protected]]