SEOUL — South Korean battery giant SK On is making a bigger push beyond electric vehicles, signing a major U.S. energy-storage battery agreement with NeoVolta Power that could become the first half of a much larger partnership.
SK On said Monday, August 31, that it will supply U.S.-based NeoVolta Power with 9 gigawatt-hours of lithium iron phosphate, or LFP, pouch battery cells over five years from 2027 through 2031.
The batteries will be manufactured at SK On’s plant in the U.S. state of Georgia, strengthening the Korean company’s efforts to build a locally produced battery supply chain for America’s rapidly expanding energy-storage market.
SK On did not disclose the contract’s financial value. However, industry estimates cited by Reuters and Korean media place the agreement at approximately 1.5 trillion won, or about US$1.09 billion.
Bigger Than One Battery Contract
The 9 GWh agreement may only be the beginning.
SK On said the two companies plan to pursue another agreement later this year covering an additional 9 GWh of LFP cells.
If completed, that would increase their total planned cooperation to 18 GWh, effectively doubling the scale of the relationship.
That second agreement, however, has not yet been finalized, meaning the confirmed contract currently remains at 9 GWh.
Korean business outlet Seoul Economic Daily reported that the proposed second arrangement would see SK On provide cells to NeoVolta Power, which would assemble the batteries into ESS packs using its packaging capabilities before supplying the completed systems back to SK On for sale to other customers.
If both arrangements proceed at a similar estimated value, Korean industry reports suggest the companies’ overall cooperation could eventually approach 3 trillion won. That figure remains an estimate rather than an officially disclosed transaction value.
Why SK On Is Betting More Heavily on Energy Storage
The deal comes as battery manufacturers search for growth outside the electric-vehicle sector.
SK On has traditionally been heavily exposed to EV batteries, supplying automakers including Hyundai, Kia and Ford. But weaker-than-expected EV demand and changes to U.S. incentives have pushed Korean battery makers to diversify production toward stationary energy-storage systems.
ESS batteries can store electricity when power is plentiful and discharge it when demand rises. That makes large battery installations increasingly important for renewable-energy projects, electricity grids, industrial facilities and power-hungry data centers.
Unlike high-nickel batteries commonly used in long-range EVs, LFP batteries offer lower costs, strong durability and thermal stability, characteristics that have made the chemistry particularly attractive for stationary storage.
SK On is not alone in making the shift. South Korean competitors LG Energy Solution and Samsung SDI have also been moving more manufacturing capacity toward energy-storage batteries as the industry’s dependence on EV growth is reassessed.
SK On’s Georgia Factories Become More Important
The NeoVolta contract could also help SK On make better use of its substantial U.S. manufacturing footprint.
Korean media reported that SK On has roughly 100 GWh of battery-production capacity in North America when its wholly owned operations and joint ventures are included.
Producing NeoVolta’s LFP cells locally in Georgia could provide SK On with a long-term customer while increasing utilization of manufacturing assets originally developed largely around the electric-vehicle market.
SK On had already started building its energy-storage business before the NeoVolta agreement.
In September 2025, the company announced an agreement with Flatiron Energy Development covering up to 7.2 GWh of LFP-based energy-storage systems between 2026 and 2030. That deal represented SK On’s first major entry into LFP batteries specifically designed for ESS applications.
The company said at the time that it planned to convert part of its Georgia EV battery production capacity for energy-storage products.
NeoVolta Is Expanding in Georgia Too
NeoVolta Power is also building its own manufacturing presence in Georgia.
NeoVolta disclosed earlier this year that it had increased its ownership of NeoVolta Power to 80% and was developing a manufacturing facility in Pendergrass, Georgia.
According to NeoVolta’s regulatory disclosures, the facility was designed initially for roughly 2 GWh of annual production capacity, with the potential to scale to as much as 8 GWh.
NeoVolta said in June that production ramp-up remained targeted for the third quarter of 2026.
That creates an interesting industrial pairing: SK On can manufacture LFP cells in Georgia while NeoVolta Power develops U.S.-based capabilities to turn battery components into larger energy-storage products.
SK On Has an Ambitious ESS Target
SK On has set a target of securing more than 20 GWh of global ESS orders in 2026.
The company has also said it is discussing potential supply agreements totaling more than 10 GWh with additional U.S. customers.
That makes the NeoVolta contract strategically significant beyond its estimated billion-dollar value.
The agreement provides SK On with a major long-term American customer, increases demand for its U.S. factories and gives the company another route into a battery-storage market that could become increasingly important as EV growth becomes less predictable.
And the biggest development may still be ahead.
If SK On and NeoVolta complete the planned second 9 GWh agreement, their partnership would expand to 18 GWh — turning one large battery order into a considerably broader U.S. energy-storage alliance.
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