# LG Energy Solution exits $1.45B Korea grid storage tender *The battery maker walked away from the 1,180 MW domestic auction over price erosion, leaving the 15-year contracts to Samsung SDI and SK On.* **Published:** November 6, 2026 **By:** Seung-min Park **Section:** Batteries & Electric Vehicles — South Korea **Format:** Breaking **Confidence:** high **Source:** https://eastasiabrief.com/batteries-ev/lg-energy-solution-exits-1-45b-korea-grid-storage-1173 **Publisher:** East Asia Brief (https://eastasiabrief.com/) --- ## What to know - LG Energy Solution dropped out of Korea's 2 trillion won ($1.45 billion) central ESS auction on Nov. 5 - Average auction prices fell below 30 won ($0.022) per kWh in earlier rounds, eroding margins - The Korea Power Exchange closes final document submissions Nov. 11 before selecting winners ![An engineer reviews battery storage cabinets with a tablet at an outdoor energy storage facility near wind turbines. (AI-generated image)](https://eastasiabrief.com/media/2026-11-06-09a6f5a72588.webp) *An engineer reviews battery storage cabinets with a tablet at an outdoor energy storage facility near wind turbines. (AI-generated image)* LG Energy Solution said Nov. 5 that it walked away from South Korea's 2 trillion won ($1.45 billion) central battery auction, refusing to match price cuts in its home market. The tender covers 1,180 megawatts across the mainland and Jeju Island. That volume represents roughly six hours of storage, or 7,080 megawatt-hours, matching the combined scale of Korea's first two auctions. The withdrawal leaves the domestic utility battery field to Samsung SDI and SK On. Both rivals submitted proposals before the Nov. 4 tender deadline. The tender, issued Sept. 22 by the Ministry of Climate, Energy and Environment alongside the Korea Power Exchange, procures long-duration grid storage under 15-year power contracts. The project requires utility systems to reach commercial operation by February 2029. Evaluators split scores evenly between installation pricing and non-price parameters like domestic material use and fire safety. LG Energy Solution prioritized margins over domestic volume, the company said. It described the move as a choice to maximize the operating efficiency of its capital and workforce. Pricing in previous tenders eroded operating returns. Average bid prices dropped from the 30-won range ($0.022) per kilowatt-hour in the first round to the 20-won range ($0.015) in the second. The company secured 215 megawatts across the first two rounds, taking a 19% share of awarded capacity. Samsung SDI secured 56%, while SK On took 25% by bidding lower-cost iron-phosphate chemistry. LG Energy Solution decided that repeating those discount bids would weaken corporate earnings. The manufacturer instead directed manufacturing lines toward higher-value energy contracts in North America. The battery maker holds an order backlog of 160 gigawatt-hours in its global storage division. North American demand from power utilities and artificial intelligence data centers accounts for the bulk of those commitments. The company signed its first direct battery supply contract with a US cloud computing company during the third quarter. That deal provides containerized storage systems for facilities that require round-the-clock power. Factory output for storage systems increased by more than 60% in the third quarter from the prior three months. The storage division supplied roughly 30% of consolidated company revenue during that period. LG Energy Solution is adding production lines in the United States to supply utility developers. It aims to secure more than 70 gigawatt-hours of regional storage manufacturing capacity by the end of 2027. Its Lansing site in Michigan started producing lithium-iron-phosphate cells for power customers in August. A second standalone battery complex in Queen Creek, Arizona, will add dedicated storage lines. Deliveries to the American market also generate tax credits under the Inflation Reduction Act. The company booked 416.9 billion won ($302 million) in US advanced manufacturing incentives during the third quarter alone. Those federal production credits give North American sales a financial cushion that domestic Korean tenders lack. Korean auctions offer fixed service payments without equivalent local manufacturing tax subsidies. South Korean project margins have thinned as developers source cheaper battery materials from overseas chains. Domestic battery makers must compete on price against systems that integrate low-cost imported hardware. The departure highlights diverging corporate strategies. Samsung SDI continues to pitch high-energy nickel-cobalt-aluminum packs, while SK On targets scale through cost-competitive iron-phosphate units. LG Energy Solution said it will fulfill its existing domestic commitments. It plans to supply cells for its Haenam and Gwangyang projects awarded under earlier central auctions. The company will also continue work on a distribution-grid storage pilot awarded by the state government in July. At its Ochang plant in North Chungcheong Province, conversion work continues on lines for next-generation chemistries. The Korea Power Exchange will close submissions of secondary proof documents on Nov. 11, with winning power developers scheduled for final selection later this month. The tender notice does not state whether minimum bid pricing floors will apply in future auctions, and the ministry has not published project-level bid results from the completed rounds. ## Impact map | Event | Korea | China | Japan | Global impact | | --- | --- | --- | --- | --- | | Korea grid battery auction exit | LG Energy Solution withdraws from 1.18 GW tender, leaving Samsung SDI and SK On to split 2 trillion won in awards | Chinese cell components face stricter scrutiny under 25-point domestic economic contribution criteria | Japanese power equipment vendors see stable inverter demand across Korean grid sites | LG Energy Solution reallocates manufacturing volume toward North American utility and AI data center backlogs totaling 160 GWh | | Korea grid battery auction exit | LG Energy Solution withdraws from 1.18 GW tender, leaving Samsung SDI and SK On to split 2 trillion won in awards | Chinese cell components face stricter scrutiny under 25-point domestic economic contribution criteria | Japanese power equipment vendors see stable inverter demand across Korean grid sites | LG Energy Solution reallocates manufacturing volume toward North American utility and AI data center backlogs totaling 160 GWh | ## In this story - **Companies:** LG Energy Solution, Samsung SDI, SK On - **Tickers:** 373220.KS, 006400.KS - **Exposed:** Korea Power Exchange - **Policy:** Procurement Rules - **Impact:** Pricing, Capex, Order Book ## Primary sources 1. kpx.or.kr 2. electimes.com 3. einfomax.co.kr 4. newstomato.com 5. mtnews.net --- Cite as: East Asia Brief, "LG Energy Solution exits $1.45B Korea grid storage tender," November 6, 2026. https://eastasiabrief.com/batteries-ev/lg-energy-solution-exits-1-45b-korea-grid-storage-1173