Overseas orders for Korean energy storage systems (ESSs) have been a steady rise, even after a government investigation team said in February that defective ESS batteries were the main cause of the spate of ESS fires that took place in Korea in recent years.
The Korean ESS market has been slumping due to ESS fires, but foreign ESS markets continue to grow rapidly.
Korea’s leading battery manufacturers, LG Chem and Samsung SDI, received dozens of orders for ESS batteries from overseas customers even after the ESS fire accident investigation ream concluded in February that their defective batteries are to blame for the fires. Since February, both companies have won more than 10 ESS orders, respectively. In particular, LG Chem provided batteries to LG Electronics to help it supply ESSs to the government of Hawaii.
The size of the Korean ESS market was US$1.5 billion in 2018 but fell to US$420 million in 2019, battery market researcher SNE Research said. On the other hand, the North American and European ESS markets grew from US$520 million and US$420 million to US$900 million and US$620 million, respectively, during the same period. SNE Research forecasts that the North American ESS market is expected to become four times larger than that in Korea in 2020 and 10 times larger in 2024.
“As the overseas ESS market is growing rapidly, blaming Korean batteries for the ESS fires on unconvincing evidence makes it difficult for Korean ESS makers to do business,” an industry insider said. “In Korea, if all announced ESS safety measures are put into practice and no problems occur as a result, the EXX market will begin to trust Korean ESSs again, I think."
Meanwhile, in the global ESS market in 2019, Samsung SDI ranked first with a 28 percent share, followed by LG Chem with 23 percent, SNE Research said.