Samsung SDI America has finalized a confidential contract to supply energy storage system (ESS) batteries, with the details of the counterparty, contract value and duration withheld until January 2030. Industry observers widely interpret the agreement as a deal with Tesla, following negotiations that began last year. The arrangement is understood to call for an annual delivery of 10 GWh of lithium iron phosphate (LFP) ESS batteries over a three-year period starting in 2027, representing approximately 3 trillion won in revenue for Samsung SDI.
Tesla’s interest in large-scale energy storage reflects its broader strategy to address anticipated power shortages driven by the rapid expansion of artificial intelligence data centers and to develop new energy and grid businesses. A similar ESS LFP battery supply agreement was reported in July of last year, when LG Energy Solution signed a three-year pact—also presumed to involve Tesla—worth around 6 trillion won. Both agreements highlight Tesla’s push to secure high-volume ESS capacity in preparation for future growth.
This latest contract follows Samsung SDI’s announcement last month that it had secured a 2 trillion won ESS LFP battery order from a U.S. energy infrastructure firm. Such consecutive wins demonstrate the increasing focus of battery manufacturers on stationary storage solutions amid a temporary softening of electric vehicle demand. Historically, Samsung SDI produced ternary (NCA) batteries for ESS applications, but it has since accelerated plans to establish LFP production lines to meet growing market preference for LFP technology, which now accounts for roughly 80% of the global ESS sector.
To support this shift, Samsung SDI intends to convert electric vehicle battery production lines at its U.S. joint venture plant with Stellantis to ESS battery manufacturing. The company aims to reach an annual ESS battery production capacity of 30 GWh in the United States by the end of this year. According to BloombergNEF, U.S. cumulative ESS installation capacity is projected to climb from 19 GW in 2023 to 250 GW by 2035, underscoring the expanding opportunity in grid-scale energy storage.
Source: Business Korea
