TLDRs;
- LG Energy Solution will produce LFP batteries in Korea for the first time, starting at its Ochang plant in 2027.
- The move aligns with rising ESS demand as Korea expands renewable energy and boosts incentives for locally made storage tech.
- LGES begins with 1 GWh annual capacity, aiming to scale as government-backed projects accelerate through 2036.
- Korea’s push for domestic production supports safety, certification, and global competitiveness in a rapidly expanding ESS market.
South Korea’s battery manufacturing landscape is set for a major shift as LG Energy Solution (LGES) prepares to begin domestic production of lithium iron phosphate (LFP) batteries by 2027.
The company confirmed on Monday that it will manufacture LFP cells for energy storage systems (ESS) at its Ochang plant in Cheongju, marking the first time the battery giant produces this chemistry within Korea.
Until now, LGES has relied on its facilities in the United States and China for LFP output.
Domestic Shift Marks Strategic Pivot
The decision signals a strategic repositioning by LGES as global demand for cost-efficient and safety-focused LFP technologies rises.
The company will start with 1 gigawatt-hour (GWh) of annual production, with plans to scale as ESS adoption accelerates across public and private sectors.
The move comes as Korea intensifies incentives for storage systems produced inside the country, particularly for government-backed grid stabilization and renewable balancing projects. As competition for ESS contracts increases, proximity to certification bodies and familiarity with domestic compliance frameworks give Korean manufacturers a meaningful edge.
Grid Stability Driving ESS Demand
South Korea’s broader energy transformation is also shaping LGES’s timing. The government’s 10th Basic Plan for Electricity Supply and Demand aims to lift stable power capacity, primarily sourced from nuclear, LNG, and storage-backed renewables, from 35% in 2022 to more than 65% by 2036. This shift reflects the growing strain intermittent power sources place on the national grid.
The Korea Power Exchange (KPX), which oversees power trading and procurement, is set to select contractors for a 540 megawatt-hour ESS project scheduled for completion by late 2027.
LGES’s planned LFP ramp-up aligns almost perfectly with this timeline, positioning the company to compete in major domestic tenders. Notably, LGES previously secured 24% of an earlier bidding round, reinforcing its foothold in Korea’s utility-scale ESS market.
Local Certification Spurs Manufacturing
South Korea’s ESS equipment must clear strict Korea Certification (KC) and KCs safety requirements, a process that domestic manufacturers navigate with more ease compared to foreign competitors.
With the government targeting 35% of the global ESS market by 2036, national players are expected to benefit from tighter industrial alignment and streamlined approval paths.
Beyond batteries, large-scale ESS units require components such as power conversion systems (PCS), energy management systems (EMS), battery management systems (BMS), transformers, and thermal control technology. Each stage goes through rigorous Factory Acceptance Tests (FAT) and Site Acceptance Tests (SAT), creating steady work across Korea’s engineering, testing, and certification sectors.
Global Standards Influence Korea’s Path
While Korea leans on its KC and KCs standards, international markets, especially North America, operate under frameworks such as NFPA 855, NFPA 70, and UL 9540/9540A for thermal runaway safety. LGES’s experience across regions strengthens its competitiveness as Korea looks to expand its footprint in global ESS deployments.
Foreign engineering firms also continue to play supporting roles in Korea’s energy transition, especially as the country moves toward completing a standard design for small modular reactors (SMRs) by 2025, a key component of its long-term energy mix.
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