LG Chem expands its energy storage system (ESS) production lines in Nanjing, China. The specific size of investment to this end and the number of production lines to be added have yet to be disclosed. LG Chem is planning to export the systems it produces there to the United States and Europe without selling them in China. According to the company, construction for the expansion has just begun.
The ESS production line expansion in China is because the global demand is soaring these days and LG Chem recently won multiple contracts. According to market research firm SNE Research, the global lithium ion battery ESS market grew from 1,647 MWh to 2,872 MWh between 2016 and last year, when LG Chem’s production capacity more than doubled from 293 MWh to 591 MWh. In the recent past, the company signed an ESS battery supply contract with ABB, a solar power ESS supply contract with IBC Solar, a home ESS supply contract with SMA and so on.
The demand for the same type of systems is likely to increase in South Korea as well with the Ministry of Trade, Industry & Energy of the country having revised national regulations late last year to make ESS installation mandatory at certain public institutions. New local market creation based on this measure is estimated to reach 244 MWh a year until 2020.
Last year, LG Chem ranked first in the market for the second consecutive year with a market share of 21%. It was followed by Samsung SDI, which accounted for 19% of the market with a capacity of 544 MWh, while Tesla increased its production capacity almost fivefold in just one year to 186 MWh.