South Korean battery maker Samsung SDI has signed a three-year contract through its US subsidiary to start supplying prismatic lithium iron phosphate (LFP) batteries for energy storage systems (ESS) in North America from 2027.

The contract is valued at more than 2 trillion South Korean won ($1.35 billion). Michigan-based Samsung SDI America will manufacture the batteries at its Indiana facility. The manufacturer has been shifting some of its production lines for EVs to lines for ESS batteries to meet local demand.

Samsung SDI’s prismatic cells are equipped with anti-thermal propagation technology to prevent heat from spreading to adjacent cells by placing thermal insulation materials between cells and measuring the temperature of a specific cell. The cells are packed in a 20 ft container, Samsung Battery Box (SBB) 2.0, an all-in-one ESS that incorporates a number of battery racks in a single container, which the company said provides greater portability and user convenience for installation.

Samsung SDI launched the first edition of SBB with its flagship nickel cobalt aluminum (NCA) cells in 2023.

By expanding its portfolio into LFP technology, Samsung SDI said it aims to strengthen its technical differentiation and accelerate the international expansion of its prismatic batteries for ESS.

The company said it has overcome the lower energy density disadvantage of LFP while maximizing safety and price competitiveness by using different anode materials and electrode processes.

Samsung SDI said its prismatic LFP cells are more resistant to external shocks than ESS using other types of LFP cells because they feature an aluminum casing that incorporates safety design features like vents and fuses.

In addition to the latest contract, the company is in discussions with multiple customers for the supply of LFP and NCA batteries, suggesting more contracts to come in the near future.

“It is a significant opportunity for Samsung SDI to expand into the US ESS market with the first long-term contract for LFP supply,” the company said. “Through the first supply of SBB 2.0 for ESS installation in the US, Samsung SDI will start providing US customers with ESS batteries to meet their needs not only for high-performance but also for enhanced safety and price competitiveness, enabling them to stabilize power supplies in the era of renewable energy and AI.”

Source: Samsung SDI