LG Chem: C&I to be as big as grid-scale

LG Chem battery boss sees huge growth in C&I storage. LG Chem is also taking on Tesla in home energy storage and increasing its grid-scale projects.
LG Chem battery boss sees huge growth in C&I storage. LG Chem is also taking on Tesla in home energy storage and increasing its grid-scale projects. Photo credit: LG Chem
LG Chem battery boss sees huge growth in C&I storage. LG Chem is also taking on Tesla in home energy storage and increasing its grid-scale projects.

LG Chem battery storage boss sees huge growth in C&I storage. The company is also taking on Tesla in home energy storage and increasing grid-scale projects. Photo: LG Chem

By Jason Deign

A top executive at LG Chem has added to growing optimism over the prospects for commercial and industrial (C&I) energy storage growth in the US.

Peter Gibson, LG Chem’s director of energy storage system sales, told Energy Storage Report: “In North America, revenue-wise the C&I segment in the next five years could be as large as or even greater than grid-scale.”

His sentiment echoes views expressed by project developers such as Sharp and Demand Energy, which are seeing growing interest in behind-the-meter systems among large energy users.

“Looking at the advantages storage can bring to demand-charge management, we’re very optimistic about how large that C&I segment could grow in the next five years,” Gibson said.

LG Chem last month unveiled a partnership with the worldwide electrical distributor Gexpro, the operating system developer Geli and the power converter maker Ideal Power to target the C&I market.

Larger systems will be revealed

The Gexpro system comes in 30kW, 45kWh units. Additional larger systems will be revealed in time, Gibson confirmed.

“A typical installation will use between one and eight 30kW battery energy storage solutions in a commercial building with high peak loads such as retail, office buildings and schools,” said Gexpro in a press release.

Demand for such products will “be focused primarily on those states where demand charges are a big component of the energy bill,” Gibson said.

According to Gexpro, such charges can account for half of all energy costs in some US locations. Gibson hinted at significant activity relating to C&I in the US over the last 12 months.

For now, though, where LG Chem has seen greatest success has been in multi-megawatt, grid-scale projects, particularly within the PJM Interconnection regional transmission organisation catchment area.

Duke Energy battery project

Two weeks ago LG Chem, along with customer Duke Energy and control systems developer Greensmith, announced a 2MW fast-response battery project designed to improve PJM grid stability in Ohio.

“This accurate and rapid response will help improve the overall reliability and economic efficiency of the grid,” said Phil Grigsby, Duke Energy’s vice president of commercial transmission, in a press statement.

“It also demonstrates the capabilities of new technologies and the potential for future applications, such as large-scale integration of renewable energy onto the grid.”

The project was the second for LG Chem with Greensmith for fast-responding frequency regulation services in the region.

“Here in North America, the PJM market for fast-acting frequency regulation has been pretty hot for the past 12 to 18 months,” Gibson noted. “I think it will continue to be really hot for the next 12 to 18 months going forward.

PJM is still very attractive

“It’s encouraging to see companies like Duke building additional capacity in PJM. It’s further endorsement that the market in PJM is still very attractive.”

Compared to California, where many projects will not get built until the end of the decade, in PJM energy storage facilities are being installed today, Gibson said. LG Chem expects to have four PJM projects online by the end of the year.

Gibson: “That’s great for generating revenues, but more importantly for the industry it’s important to see storage projects go online, operating reliably, generating the sorts of incomes that the project sponsors expect to get.”

Besides C&I, and California and PJM for grid-scale projects, LG Chem, which already commands around 40% of the global electric and hybrid vehicle battery market, is also gunning for residential energy storage.

Tesla is certainly not the only company that is looking at residential systems,” said Gibson. “We’ve been very active in that area, too.”

In April, LG Chem trumpeted a tie-up with Eguana Technologies of Alberta, Canada, for ‘premium home battery systems’.

A durable energy storage installation

“The AC Battery is a pre-integrated and fully certified energy storage system which requires only a grid connection and a dispatch signal to provide a fully functional and durable energy storage installation,” said Eguana.

“The AC Battery provides maximum flexibility for system aggregators which want to deploy it as part of new solar storage installations or as a retrofit to solar PV installations already in place.”

Gibson said he did not expect the US residential energy storage market to equal the C&I or grid-scale segments in terms of revenue potential, “but it still will be significant over the next five or 10 years.

“I think it will be a rapidly growing segment, not just in California. The Tesla announcement really did great things for the industry. Their marketing skills are really to be admired. I cannot but applaud what they did at the end of April.”

As to what Tesla’s announcement means for LG Chem’s pricing in the market, all he would add is: “On both residential and commercial, let me say we are confident that we know what the market price is for each of those areas.

“We are very confident that we will have products that will compete… this year.”

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