LG Energy Solution is poised to commence energy storage system (ESS) battery production at its Ultium Cells joint venture facility with General Motors in Spring Hill, Tennessee, solidifying its position with a total of five ESS manufacturing sites across North America.
Ultium Cells announced a significant $70 million investment on Wednesday to repurpose existing EV battery lines at its Spring Hill plant for the production of lithium iron phosphate (LFP) battery cells specifically designed for energy storage systems. Mass production is slated to begin in the second quarter of this year.
These ESS batteries will be channeled through Vertech, LG Energy Solution’s North American ESS integrator, and will be deployed for critical applications such as grid stabilization, renewable energy initiatives, and powering AI data center infrastructure. This strategic move is expected to optimize plant utilization, enhance operational efficiency, and maintain stable employment levels amidst a moderating electric vehicle (EV) market.
This expansion gives LG Energy Solution five ESS production hubs within North America. These comprise standalone plants in Michigan and Canada, including the NextStar Energy facility (previously a joint venture with Stellantis), and strategic partnerships such as Ultium Cells in Tennessee, and a joint venture with Honda in Ohio. These strategically located facilities will operate as flexible production centers, adept at producing both EV and ESS batteries, allowing LG Energy Solution to adapt to evolving market demands.
The Holland, Michigan plant is a crucial hub, having initiated North America’s first large-scale ESS battery production in June of last year. It currently supplies key clients like Terra-Gen and Delta. The NextStar Energy facility in Canada achieved a milestone of producing over 1 million cells within three months of commencing ESS production. Furthermore, the Lansing, Michigan plant is set to introduce ESS pouch cells in the first half of this year and expand its production to include prismatic LFP batteries next year, with confirmed orders from Tesla.
Leveraging its expanding manufacturing footprint, LG Energy Solution is intensifying its efforts to secure new ESS contracts throughout North America, driven by robust demand from renewable energy projects and the burgeoning sector of AI-powered data centers.
The company intends to more than double its global ESS capacity to surpass 60 gigawatt-hours by the end of the year, with over 50 gigawatt-hours specifically dedicated to North American production. The company had approximately 140 gigawatt-hours in accumulated ESS orders as of 2024 and aims to surpass last year’s record of 90 gigawatt-hours.
According to an LG Energy Solution representative, “The establishment of five manufacturing sites across North America will be a catalyst for growth, enhancing operational efficiency, and improving profitability. By capitalizing on our first-mover advantage in ESS production, we are committed to further solidifying our leadership position in the region.”
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