LG Energy Solution will supply batteries for Google's largest-ever solar and energy storage system (ESS) project.

According to industry sources on July 15, Google and Cypress Creek Renewables (CCE), an independent power producer (IPP) of renewable energy, announced on July 14 (local time) that they are launching the Steel River Energy Center project.

The two companies plan to build an ESS with an initial capacity of 2 gigawatt-hours (GWh), aiming for operation by 2029, and subsequently expand it to 2.9 GWh. They have decided to utilize LG Energy Solution's batteries for the project.

The value of the contract is estimated to be in the hundreds of billions of won.

Google decided to pursue this project to address the rising power demand resulting from the expansion of its AI data centers.

The company plans to purchase the entire initial power output to expand its use of clean energy and strengthen power grid stability.

This project is the largest solar and ESS initiative in Google's global portfolio.

LG Energy Solution is set to supply its lithium iron phosphate (LFP)-based ESS solution, JF2 DC Link, which is produced in North America.

As AI continues to spread, competition among big tech companies to secure power is becoming increasingly intense.

According to market research firm BloombergNEF (BNEF), Google's power consumption increased by 37% last year, while Microsoft's rose by 24%.

Furthermore, Google, Meta, Amazon, and Microsoft accounted for 49% of global corporate renewable energy purchase agreements last year, leading large-scale solar and ESS projects.

With this contract, LG Energy Solution has secured another major energy infrastructure project linked to AI power demand, following the DTE Energy data center project in May.

Industry experts believe that LG Energy Solution's localization strategy, supported by its North American production base, played a positive role in winning this project, especially as the U.S. has strengthened regulations on Chinese supply chains, making local production systems more critical.

In fact, Google and CCE emphasized that major equipment, including batteries, solar panels, and structural steel, will be sourced from North American supply chains.

LG Energy Solution currently produces ESS batteries at four production hubs in North America: Holland, Michigan; the L-H Battery Company in Ohio; Ultium Cells in Tennessee; and NextStar in Canada.

LG Energy Solution plans to begin ESS battery production at its Lansing, Michigan plant within this year, aiming to expand its global ESS production capacity to over 60 GWh by the end of this year, with more than 50 GWh of that capacity secured in North America.

(Photo: Provided by LG Energy Solution, Yonhap News)