SK On signs battery deal with NeoVolta Power

by · UPI

SEOUL, Aug. 31 (UPI) -- South Korea's SK On said Monday that the battery manufacturer has signed a multi-year contract with U.S. energy storage system, or ESS, corporation NeoVolta Power.

The Seoul-based company noted that it would supply 9 gigawatt-hours of battery cells to NeoVolta Power. The value of the deal was reported to be around $1 billion, but SK On refused to confirm the figure.

Under the agreement, SK On plans to provide lithium iron phosphate, or LFP, pouch-type battery cells for five years through 2031. They will be produced at SK On's U.S. plant in Georgia.

The 9 gigawatt-hours of battery cells are roughly enough to supply electricity to nearly 1 million households for a day.

SK On said that the company has been diversifying its portfolio beyond high-nickel batteries primarily used in electric vehicles by expanding into LFP batteries for battery energy storage systems, or BESS.

"This partnership strengthens SK On's position in the U.S. BESS market and brings together SK On's U.S.-made LFP battery technology with NeoVolta Power's growing energy-storage manufacturing capabilities," SK On's ESS business chief Choi Dae-jin said in a statement.

"We view NeoVolta Power as a strategic partner as we expand our presence in the U.S. energy-storage market. By combining our respective capabilities, we will pursue new commercial opportunities and deliver competitive BESS solutions that meet evolving market needs," he added.

NeoVolta Power President Steve Bond expected that the bilateral partnership would accelerate growth for the two companies in the BESS market, thus helping address rising demand in the United States.

"SK On's battery cell technology and U.S. manufacturing capabilities, combined with NeoVolta Power's energy storage expertise and manufacturing capabilities, provide a strong foundation for this strategic partnership," he said.

SK On is not publicly listed. The share price of its parent company, SK Innovation, jumped 7.36% on the Seoul bourse on Monday, while the benchmark KOSPI edged up 0.46%.

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