LG Energy Solution has begun producing lithium iron phosphate (LFP) batteries for energy storage systems (ESS) at Ultium Cells, its joint venture with General Motors.
Ultium Cells said it had fully launched production of LFP cells for ESS at its Tennessee plant Monday.
The milestone comes just four months after Ultium Cells announced its plan to produce LFP products for ESS in March this year. At the time, Ultium Cells said it would convert part of its existing electric vehicle battery production line into an ESS battery production line through an equipment conversion investment of about $70 million.
The ESS batteries produced at the Tennessee plant are supplied through Vertech, the North American ESS SI (system integration) subsidiary of LG Energy Solution (373220.KS). They will be used in various fields going forward, including North American power grid stabilization projects, renewable energy-linked ESS facilities, and power infrastructure for AI data centers. Products made at the Tennessee plant meet the "U.S.-made manufacturing requirements" under the U.S. government's Inflation Reduction Act (IRA) and other rules.
"This start of LFP production for ESS at the Tennessee plant is evidence of our expanded production capabilities," said Park In-jae, head of Ultium Cells. "Based on LG Energy Solution's advanced battery technology and the dedication of our Tennessee employees, we have successfully established an ESS production system in all respects, including safety and productivity."
Chris Dissotel, plant manager, said, "The successful conversion to LFP production is a result that demonstrates the solid partnership between LG Energy Solution and GM, and a case that confirms the long-term growth potential across Ultium Cells' network." He added, "Ultium Cells will play a key role in helping companies reliably build ESS for various strategic technology applications, including power grids."
LG Energy Solution plans to accelerate its "establishment of five ESS integrated manufacturing hubs in North America" through the mass production at the Ultium Cells Tennessee plant. Following the Michigan Holland plant, which began large-scale ESS mass production for the first time in North America in June last year, LG Energy Solution started ESS production at NextStar Energy in Canada in November last year.
On the 2nd of this month, production also began at the Honda joint venture plant in Michigan, and the Lansing plant in Michigan is also targeting the start of mass production within the year. LG Energy Solution plans to secure more than 50 GWh of production capacity in North America alone by the end of this year.
Based on its secured production capacity, LG Energy Solution plans to further step up its efforts to expand new ESS orders. In North America alone, LG Energy Solution has signed consecutive order contracts with global clients including Tesla, Terra-Gen, Excelsior Energy Capital, EG4, and Hanwha Qcells. In May, it also signed a contract to supply a total of 6 GWh of ESS batteries with DTE Energy, which carries out projects such as the AI data center of global big tech firm Oracle.
