LG Energy Solution has been selected as the operator for a government project to build distribution-grid energy storage systems (ESS), part of an effort to expand power infrastructure in the Honam region.
LG Energy Solution (373220.KS) said on the 10th that it was chosen as the final operator for the "2026 AI-Utilizing ESS Construction Support Project" organized by the Ministry of Climate, Energy and Environment.
LG Energy Solution formed the "Sunlight Distribution Grid Energy" consortium with Shinhan Asset Management to participate in the project bid. A total of nine operators and 32 distribution lines were selected for the project, and LG Energy Solution succeeded in securing seven distribution lines, the maximum volume a single operator can obtain. The secured volume is 20 MWh per line, for a total of 140 MWh.
Commercial operation is set to begin in 2027, with an operating period of 20 years. LG Energy Solution will be responsible for supplying high-performance batteries as well as ESS construction and overall AI-based operations. Shinhan Asset Management, a consortium participant, will handle financial structuring based on power market revenue, drawing on its experience operating solar power funds.
LG Energy Solution emphasized that this achievement is the result of expanding its role as a virtual power plant (VPP) operator beyond being a simple ESS battery supplier. LG Energy Solution has already accumulated AI-based ESS operating experience, having established and operated a distribution-grid-linked ESS power plant in the Seogwipo area of Jeju in 2024.
"This project selection is a meaningful achievement in the process of leaping from a battery supplier to an energy platform company," said Kang Chang-beom, head of LG Energy Solution's ESS Battery Business Division. "By leveraging our AI-based ESS operating capabilities, we will accelerate business growth and contribute to stabilizing the national power grid."
This is the first distribution-grid ESS construction support project the government has undertaken. Currently, existing substations and distribution lines in some areas where renewable energy is concentrated, such as Honam and Jeju, have reached saturated capacity. In response, the government has moved to address this problem by building ESS as a buffer on distribution lines.
Distribution-grid ESS has drawn attention as key infrastructure for activating distributed energy, as it can quickly raise grid capacity in a short period without large-scale transmission grid expansion. During times when renewable energy generation is concentrated, the ESS stores power to reduce the burden on the distribution grid, and conversely, uses the stored power when demand is concentrated or when there is grid capacity to spare.
