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SK On to Supply 9 GWh of Battery Cells to NeoVolta in 1.5 Trillion Won Deal
SK On, a South Korean battery manufacturer, has entered into a five-year agreement to supply 9 gigawatt-hours (GWh) of lithium iron phosphate (LFP) battery cells to U.S. energy storage company NeoVolta Power. The supply deal, set to run from 2027 through 2031, is valued at approximately 1.5 trillion won, according to a report from Yonhap News citing industry sources.
Details of the Supply Agreement
Under the terms of the deal, SK On will serve as the primary cell supplier for NeoVolta Power's battery energy storage system (BESS) products. The agreement specifically covers the supply of LFP pouch-type cells, a chemistry favored for stationary storage applications due to its long cycle life and thermal stability.
SK On confirmed that the battery cells for the agreement will be manufactured at its production facility in the United States. This move aligns with the broader industry trend of localizing supply chains for the North American market.
AdMarket Reaction and Context
News of the major supply contract prompted a positive investor response. Shares of SK Innovation Group, the publicly traded parent company of SK On, surged over 6% on Monday following the announcement.
This agreement marks a significant step for SK On in penetrating the growing U.S. energy storage market. By partnering with NeoVolta, the company secures a long-term offtake partner for its U.S.-made LFP cells, strengthening its position as a key supplier for both electric vehicles and stationary grid solutions.
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