Core Viewpoint - Korean battery companies are aggressively securing contracts in the energy storage market, with SK On recently announcing a deal to supply 7.2GWh of advanced energy storage systems to Flatiron Energy Development, valued at approximately 2 trillion KRW (about 14.3 billion USD) [2][3]. Group 1: SK On's Recent Developments - SK On signed an agreement with Flatiron to provide 7.2GWh of advanced energy storage systems from 2026 to 2030, starting production of lithium iron phosphate (LFP) batteries in the second half of 2026 [2]. - The company is transitioning part of its electric vehicle battery production line in Georgia to focus on energy storage systems [2]. - Despite financial pressures, SK On is actively developing LFP batteries and plans to launch its first LFP battery prototype in 2023, followed by a winter-specific battery in 2024 and a long-life LFP battery in 2025 [2]. Group 2: Supply Chain and Market Dynamics - In July, SK On signed a memorandum of understanding with L&F for the supply of LFP cathode materials in North America, aiming to establish a long-term partnership [3]. - The recent contracts secured by Korean battery companies highlight their early positioning in the North American market and indicate a new phase in competition with overseas firms [3]. - The impact of tariffs is reducing the competitiveness of Chinese battery companies in the North American market, with a reported 82% year-on-year decline in Chinese energy storage orders to the U.S. from January to May [4]. Group 3: Industry Trends and Future Outlook - The shift of U.S. energy storage system integrators towards Korean battery companies is driven by cost reduction and maintaining profitability, as they seek to avoid reliance on Chinese supply chains [4]. - Chinese companies are attempting to establish manufacturing facilities in Southeast Asia and Europe to penetrate the U.S. market, but face significant challenges due to regulations like the Inflation Reduction Act [4][5].

Group 1 - SK On has signed an agreement with Flatiron Energy Development to supply up to 7.2 GWh of lithium iron phosphate (LFP) battery energy storage systems from 2026 to 2030, with a total contract value of up to 2 trillion KRW (approximately 10.26 billion RMB) [1][2] - The agreement includes the provision of containerized energy storage systems (ESS) using 1 GWh LFP batteries starting in the second half of 2026 [1] - SK On has also secured a "priority offer" for a 6.2 GWh energy storage project being advanced by Flatiron in the United States [2] Group 2 - SK On plans to convert part of its electric vehicle battery production line at its Georgia plant into a production line for energy storage systems, with mass production of LFP batteries expected to begin in the second half of next year [2] - According to SNE Research, global power battery installation volume reached 590.7 GWh from January to July 2025, representing a year-on-year growth of 35.3% [2] - In the same period, SK On's installation volume was 24.6 GWh, showing a year-on-year increase of 17.4%, although its market share slightly decreased to 4.2%, ranking fifth in the market [4]