Global Energy Storage Battery Weekly: ESS orders, LFP expansion, and battery-swapping networks continue to heat up

Overview

This issue of "Global Energy Storage Battery Weekly 1 June" is a weekly update on the global energy storage battery value chain, covering developments in batteries, ESS, LFP materials, battery swapping, logistics, recycling, and next-generation battery technologies across markets including the United States, China, South Korea, Japan, Saudi Arabia, the United Kingdom, and the Netherlands. The main theme is that grid energy storage and AI infrastructure are driving ESS demand expansion, while slowing EV demand, regional competition, and low utilization in material segments continue to affect corporate capex and earnings quality.

Core views

The core views are: first, ESS demand continues to be supported by grid stability, renewable energy integration, and AI data center power demand; second, LFP material and battery capacity continue shifting toward cost-effective energy storage applications; third, Chinese companies continue to extend their scale advantages in batteries, equipment, and battery swapping for electric commercial vehicles; fourth, Korean battery and materials companies on the one hand benefit from ESS opportunities in the United States and globally, while on the other still face pressure from slowing EV demand and competition from China-made EVs; fifth, technology directions such as solid-state, lithium-metal, and graphite recycling provide long-term optionality, but commercialization and capacity ramp-up still need validation.

Analysis framework

The report combines weekly news flow, company announcements, industry project progress, and price/valuation displays, summarizing value-chain events by region such as the Americas, Asia, and Europe, and connects them to Bernstein's existing battery and energy storage research framework through company models, industry models, the Blackbook, and a list of recent research.

Methodology notes

• Industry weekly trackingGlobal energy storage event tracking

  Assess marginal changes in the value chain using orders, capacity, projects, technology, and regional competition as the main threads.

  The report does not elaborate on a single valuation model, but instead treats ESS contracts, LFP expansion, battery-swapping networks, solid-state batteries, recycling projects, and cross-regional market share changes as high-frequency signals for judging the energy storage battery cycle.

• Coverage and valuation supportCompany models and industry models

  Use the Monthly EV Tracker, Battery Gigafactory Database, Global EV TAM, Global ESS TAM, Battery TAM, and supply-demand models for tracking support.

  These models are used to understand company events within the context of EVs, ESS, total battery demand, capacity, and supply-demand dynamics, but the current input does not provide complete model figures.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• ESS and grid-side energy storage value chain

  Directly benefits from demand for grid stability, AI data centers, and renewable energy integration.

  Strengths

  Large order values and increasing project scale, with grid-forming storage and long-term O&M services enhancing revenue visibility.

  Weaknesses

  Project delivery cycles, grid-connection certification, and system integration are highly complex.

  Comparison

  Compared with EV batteries, ESS showed stronger demand resilience in this period's news flow.

  Risks

  Policy, grid investment pace, price competition, and safety standards may affect profitability.

• LG Energy Solution

  Appears in both U.S. ESS supply and Honda JV asset sale developments.

  Strengths

  The DTE Energy agreement shows that its North American ESS capacity and customer relationships remain competitive; the asset sale improves cash flow.

  Weaknesses

  The asset sale reflects capital burden and liquidity pressure under slowing EV demand.

  Comparison

  Compared with companies with pure EV exposure, LGES can partially offset EV weakness through ESS demand.

  Risks

  U.S. EV demand, capacity utilization, lease arrangements, and ESS project execution risk.

• CATL

  Strengthens the electrification ecosystem for commercial vehicles through its light electric truck battery-swapping network.

  Strengths

  Expansion in the number of swap stations, 2-minute automatic battery swapping, and lower costs demonstrate scale and standardization capabilities.

  Weaknesses

  Network construction requires high upfront capital investment and depends on coordination in vehicle and battery standards.

  Comparison

  Compared with one-off battery sales, battery-swapping networks improve ecosystem control and customer stickiness.

  Risks

  Station utilization, regional expansion speed, operating costs, and competitor follow-up.

• LFP cathode materials

  Both Tinci and POSCO Future M are advancing LFP material capacity expansion, pointing to demand from energy storage and cost-effective EVs.

  Strengths

  Cost advantages, cycle life, and suitability for energy storage support demand growth.

  Weaknesses

  New capacity additions may intensify price pressure, and high-compaction products require process validation.

  Comparison

  Compared with high-nickel materials, LFP is better suited to cost-sensitive ESS and mass-market EV scenarios.

  Risks

  Supply-demand oversupply, customer qualification cycles, raw material prices, and project construction progress.

• Korean battery and materials companies

  Benefit from ESS orders in the U.S. and Japan while also facing pressure from China-made EVs and expansion by Chinese equipment suppliers.

  Strengths

  They still have customer bases and manufacturing capabilities in the supply chains of North America, South Korea, and Japan.

  Weaknesses

  Declining domestic EV share in South Korea, profit pressure in material segments, and low utilization in some businesses.

  Comparison

  The cost and scale advantages of Chinese companies are strengthening regional competition.

  Risks

  Slowing EV demand, changes in trade policy, customer order shifts, and price competition.

• Solid-state and lithium-metal battery technology

  Events involving Basquevolt and JRES/Factorial reflect progress in commercializing next-generation batteries.

  Strengths

  High energy density could improve performance in EVs, drones, aviation, and industrial mobility equipment.

  Weaknesses

  Industrial scale, yield, cost, and safety validation remain uncertain.

  Comparison

  Compared with the mature LFP route, solid-state and lithium-metal are more of a medium- to long-term technology option.

  Risks

  Mass-production delays, slow customer adoption, technology substitution, and capital consumption.

Key data

• LG Energy Solution and DTE Energy ESS agreementabout $1.6 billion; about 6 GWh; about two years; eight Michigan grid projectsThe batteries will be produced at LGES's factory in Holland, Michigan, and the projects include AI data center-related developments.
• LG Energy Solution sale of Honda JV battery plant assetsKRW 3.74 trillion, about USD 2.48 billionIt sold the building assets of the Ohio battery plant and will continue using them through a lease, aiming to improve liquidity and reduce near-term capital burden.
• Tinci LFP cathode material projectup to CNY 2.1 billion, about USD 310 million; annual output of 160,000 tonsThe project is located in Zhejiang and focuses on high-compaction LFP materials, targeting customers including CATL, BYD, and Gotion.
• CATL light electric truck battery-swapping networkcurrently 31 swap stations; planned 140 by the end of 2026; supports about 5,000 trucksThe Choco-SEB system can automatically swap batteries in about 2 minutes, cutting operating costs by about 50% versus diesel trucks, with a long-term target of 3,000 swap stations nationwide.
• POSCO Future M LFP capacityproduction starts in 2027, with annual capacity expanded to 50,000 tonsThrough CNP New Material Technology, it is building an LFP cathode material plant in Pohang, South Korea, and is also converting part of its ternary cathode lines to LFP pilot production.
• Hyosung Heavy Industries Japan ESS ordersabout KRW 11 billion; 10 MW / 40 MWhThe project covers five regions in Japan and includes maintenance services of up to 20 years; its first-year orders after entering Japan totaled about KRW 64 billion.
• Share of China-made EVs in South Korea33.9% in 2025, 1.1% in 2021; Korean domestic brands 57.2%The growth was mainly driven by China-made Tesla models and Chinese brands such as BYD, showing rising low-price competitive pressure.
• Zeron financingUSD 200 million; cumulative financing of USD 400 million over two monthsThe funds will be used for scaled deployment of electric heavy trucks, autonomous driving development, and global expansion.
• NR Electric Saudi grid-forming energy storage cluster2.5 GW; more than 2,000 PCS units; five major regionsThe project supports frequency regulation, voltage regulation, black start, and weak-grid stabilization; delivery took less than four months.
• Basquevolt BQV400L cellabout 402 Wh/kgIt uses an NMC cathode, lithium-metal anode, and hybrid polymer electrolyte, positioned as a high-energy-density solution compatible with existing gigafactory production lines.

Impact & implications

In terms of investment implications, ESS remains one of the clearest sources of demand growth in the battery value chain, especially in grid stability, AI data centers, and renewable energy-supporting applications, where order visibility is relatively strong. LFP expansion and battery-swapping networks show that cost priority, standardization, and commercial fleet operating efficiency are becoming important competitive dimensions. At the same time, ESS opportunities in the United States for the Korean battery chain need to be evaluated together with slowing EV demand, China's low-cost competition, and risks related to material prices and capacity utilization.

Risks

• Slowing EV demand may continue to suppress battery makers' capex, capacity utilization, and cash flow.
• New capacity additions in LFP, separators, and cathode materials may lead to oversupply and price competition.
• The rising market share of China-made EVs in markets such as South Korea may weaken the bargaining power of domestic automakers and battery suppliers.
• Larger ESS project scale brings risks in delivery, grid connection, safety, O&M, and system integration.
• Solid-state, lithium-metal, and recycling technologies have long-term potential, but their commercialization pace and cost curves remain uncertain.

What to watch

• The execution progress of LG Energy Solution's 6 GWh ESS supply to DTE Energy, as well as implementation of the Holland, Michigan plant and global ESS capacity targets.
• The station utilization, vehicle coverage, and actual cost-reduction effect as CATL's Greater Bay Area battery-swapping network expands from 31 stations to 140.
• The construction, pilot production, and customer qualification progress of Tinci's 160,000-ton LFP project in Zhejiang and POSCO Future M's 50,000-ton LFP project in Pohang.
• The subsequent operating performance of NR Electric's 2.5 GW grid-forming energy storage project in Saudi Arabia, as well as the continuity of Hyosung's orders in the Japanese ESS market.
• Changes in the share of China-made EVs in the South Korean market, and the transmission of those changes to the profitability of Korean battery, materials, and vehicle companies.
• Commercial validation of Basquevolt's 402 Wh/kg lithium-metal cell, the JRES-Factorial collaboration, and Orbia's graphite recycling pilot.