South Korea’s SK On said on Thursday it has signed an agreement with U.S.-based Flatiron Energy Development to supply lithium iron phosphate (LFP) batteries for energy storage systems (ESS), in a deal valued at an estimated 2 trillion won ($1.43 billion).
Under the agreement, SK On will provide containerized ESS units featuring 1 GWh of LFP batteries starting in the second half of 2026. The company has also secured the right of first offer for an additional 6.2 GWh project with Flatiron that runs through 2030. In total, the supply volume could reach 7.2 GWh over the period.
“This highlights SK On’s strategic expansion into the BESS market in the United States alongside its growth in the LFP battery sector, underscoring its commitment to portfolio diversification and sustainable growth,” the company said in a statement.
SK On said it plans to begin mass production of ESS-dedicated LFP batteries in the second half of 2025, converting part of its EV battery lines in Georgia for storage use, while also preparing LFP production in South Korea.
“Having a partnership with a global leader in battery production with strong engineering and integration capabilities, along with domestic resources, has become a strategic imperative,” Jonathan Poor, head of Flatiron, said in the statement.
The agreement follows a trend among major battery makers to diversify into storage to counter slower EV demand. In July, rival LG Energy Solution warned that U.S. tariffs and the planned end of federal EV subsidies in September may weigh on sales into 2026, prompting it to expand ESS output while deferring some investment.