The US battery storage system integrator arm of Korean battery manufacturer LG Energy Solution (LG ES) has signed a 4-year supply deal with developer Terra-Gen.
The parent company this morning announced the deal between its subsidiary, LG ES Vertech and California-headquartered renewable energy independent power producer (IPP) Terra-Gen.
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The deal covers the supply of ‘up to 8GWh’ of modular, containerised lithium iron phosphate (LFP) battery energy storage system (BESS) technology between 2026 and 2029. The BESS solutions will be produced in North America.
System integrator LG ES Vertech was launched in 2022 to capture full value chain opportunities in the world’s biggest energy storage market after China. LG ES purchased the assets and IP of NEC Energy Solutions after Japan’s NEC Corporation pulled the plug on the then-market leading system integrator in 2020.
This included NEC Energy Solutions’ machine learning and artificial intelligence-driven controls and energy management software platform AEROS, which will be supplied to Terra-Gen along with the hardware.
As of December last year, LG ES said Vertech had contracted or was in negotiations for 10GWh of system integration orders from customers in North America, and said today that the Terra-Gen deal is its biggest yet.
LG ES energy storage division VP Hyung-Sik Kim and LG ES Vertech CEO Jaehong Park spoke with Energy-Storage.news Premium at this year’s RE+ clean energy trade show in September, explaining the company’s vertical integration strategy, its “full commitment to the US market,” and the 16GWh of annual production capacity for cells dedicated to BESS applications it is establishing within the country.
The BESS market has grown more and more important for LG ES in the light of slower-than-expected demand for electric vehicles (EVs), the company said when announcing mid-year financial results in July.
“Based on the long-term partnership between the two companies, we will further strengthen our local production capabilities and integrated solution capabilities to provide differentiated customer value,” Hyung-Sik Kim said today of the Terra-Gen deal.
Deal follows LG and Terra-Gen collaboration on 2.2GWh California project
LG ES said the Terra-Gen deal follows a 2.2GWh collaboration between the two companies for a project in California, which is thought to refer to a portion of Terra-Gen’s Edwards & Sanborn solar-plus-storage project.
Edwards & Sanborn, built on 4,600 acres of land belonging to a US Air Force base in California’s Kern County, is equipped with BESS units supplied by LG, Samsung and BYD.
With a total energy storage capacity of 3,287MWh alongside 875MWdc of solar PV generation, it is thought to currently be the world’s single-biggest battery storage site and went into commercial operation in stages, completed at the beginning of this year.
Terra-Gen develops, owns and operates wind, solar PV and energy storage projects. As of the third quarter of this year, its operating portfolio comprised 3.8GW of projects across the three technologies, and 5.1GWh of energy storage at renewable energy sites.
Terra-Gen is 50% owned by Igneo Infrastructure Partners, a global investment manager in the portfolio of Japan’s Mitsubishi UFJ Financial Group (MUFG) and 50% owned by Abu Dhabi state-owned renewables company Masdar, which bought its stake from sustainable infrastructure investor Energy Capital Partners in a transaction which closed a couple of months ago.
