South Korea's SK On signs energy storage battery deal with US firm NeoVolta Power

SK On has signed a five-year agreement to supply NeoVolta Power with 9 gigawatt-hours of lithium iron phosphate battery cells for energy storage systems from 2027.

The South Korean company will make the pouch-type cells at its factory in Georgia. SK On did not disclose the deal’s value, although industry estimates put it at about 1.5 trillion won, or $1.09 billion.

SK On is expanding into energy storage as demand for electric vehicles weakens. It also plans a separate agreement with NeoVolta later this year that could provide another 9 gigawatt-hours of cells, which NeoVolta would assemble into battery packs. That would bring planned cooperation between the companies to 18 gigawatt-hours.

SK On has targeted more than 20 gigawatt-hours in global energy storage orders this year and said it is discussing additional U.S. contracts totaling more than 10 gigawatt-hours. Other South Korean battery makers, including LG Energy Solution and Samsung SDI, are also adapting electric vehicle production lines for energy storage as U.S. electric vehicle subsidies are phased out.