By Kim Yoo-chul
LG Chem, the world’s top supplier of lithium-ion batteries, said Wednesday that it has signed a contract with Southern California Edison (SCE) in what officials claim is “one of the most significant business deal” in the company’s battery-making history.
Under the contract, LG Chem will supply its lithium-ion battery packs to the American utility customer for an energy storage pilot project for homes and small businesses.
LG’s lithium-ion packs will be used in SCE-managed energy storage systems (ESS), core component to improve energy efficiency in smart grids.
By the end of this year, the LG Group affiliate will provide its lithium battery packs for a project at the Tehachapi wind-power complex in California. Through close collaboration with SCE, LG will supply the project up to 2015, said C.S. Song, a spokesman of LG Chem, Wednesday.
“The ESS managed by SCE is the biggest in North America with the electricity substation supplying 32 megawatts per hour, which provides 100 households with use electricity for a month,” said the spokesman. The energy department in the United States is funding the project.
Song added the latest deal will pave the way for the firm to expand into the rising smart grids-related industry in North America.
“The key point for this project is how to provide electricity produced from wind energy in the form of an ESS battery. Stabilization is key as the amount of wind energy is dependent upon volatile weather conditions,” said Song.
LG Chem is the sole battery and equipment supplier for the project. But Song declined to provide details of the project’s cost.
LG Chem’s has already been supplying lithium-ion batteries to power General Motors’ Chevy Volt and hybrid cars from Ford.
The energy storage market is growing at a rapid pace because of a growing amount of solar and wind energy coming online in the United States, said LG officials and analysts.