SK On is betting on lithium iron phosphate technology to break into North America’s booming energy storage market, signing a supply agreement with fellow Korean firm L&F as it scrambles to catch up with Chinese competitors.
The battery maker announced July 11 that it signed a memorandum of understanding with L&F on the supply of LFP cathode materials for the North American market, marking another attempt by South Korean manufacturers to challenge China’s near-monopoly in the lower-cost battery chemistry.
The agreement outlines plans for the two companies to discuss details, such as supply volume and period, with a view toward building a mid- to long-term partnership. The move comes as the U.S. energy storage market is projected to reach $1.49 trillion by 2034, growing at a 29.1% annual rate, driven largely by artificial intelligence data centers and renewable energy integration.
SK On faces significant challenges in a market where Chinese manufacturers currently hold a near-monopoly of LFP battery type production. The company has promised mass production of LFP batteries by 2026, but competitors including LG Energy Solution and Samsung SDI have already announced similar timelines.
LFP prices dropped 20% in 2024 following a 30% decrease in 2023, creating pressure on manufacturers to achieve economies of scale quickly or risk being priced out of the market.
