United States: Samsung SDI Shakes Up ESS Market Amid Carbon Neutrality Push

| Seoul = HANS Economy Reporter Kim Hye-ji | Samsung SDI is strengthening its energy storage system (ESS) business by leveraging the global shift toward carbon neutrality and the expansion of renewable energy as new growth opportunities. The company is expanding its order book in the North American market and reducing greenhouse gas emissions to secure its competitiveness as an eco-friendly energy company.

According to an analysis by HANS Economy and the ESG Happy Economy Research Institute of Samsung SDI’s financial statements and sustainability reports, the company has secured over 60 GWh (gigawatt-hours) of ESS battery orders through October this year. To address the increasing power demand from renewable energy expansion and artificial intelligence (AI) data centers, Samsung SDI is converting its local production facilities in the United States to focus on ESS, thereby broadening its business scope.

Progress in climate response has also been observed. Samsung SDI’s direct and indirect greenhouse gas emissions (Scope 1 and 2, market-based) decreased by 22.1%, from 1.345532 million tons in 2023 to 1.048485 million tons in 2025. During the same period, the renewable energy transition rate increased from 27% to 38%.

Samsung SDI has set a goal to power 100% of its domestic and overseas operations with renewable energy by 2050. To achieve this, the company is expanding power purchase agreements (PPAs) and improving energy efficiency in its manufacturing processes. In the sustainability report, CEO Choi Ju-sun stated, “Based on our outstanding prismatic battery technology and safety technology, Samsung SDI is leading the ESS battery market, which is the core of the eco-friendly energy sector.”

▲ Amid sluggish EV sales, ESS order backlog surpasses 60 GWh

Samsung SDI's revenue, based on its standalone financial statements, declined by approximately 40.0% from 19.1064 trillion won in 2023 to 11.4557 trillion won in 2025. During the same period, operating profit shifted from a surplus of 55.44 billion won to a deficit of 232.10 billion won.

Although performance deteriorated due to the slowdown in electric vehicle battery demand, a recovery trend emerged this year, centered on the Energy Storage System (ESS) business. Samsung SDI reported consolidated revenue of 468.56 billion won and an operating profit of 40.78 billion won for the third quarter of 2026. Revenue increased by 52.6% year-on-year, and operating results turned positive.

Focusing on the U.S. ESS market, Samsung SDI secured battery orders exceeding 60 GWh through October this year. In March, the company signed a supply contract worth approximately 150 billion won with a U.S. energy specialist, and in October, it concluded an additional ESS solution supply contract for 1 GWh with Alpha Omega Power (AOP).

The company is also adjusting its local production facilities in the U.S. to focus on ESS. Samsung SDI is converting part of its electric vehicle battery production line at the Star Plus Energy (SPE) plant in Indiana for ESS use and began mass production of prismatic lithium iron phosphate (LFP) batteries in October.

Choi Ju-sun, President of Samsung SDI, stated, "2025 was a year in which the role of batteries was redefined amid a rapidly changing industrial environment." He added, "Samsung SDI will leverage these changes as new opportunities and make 2026 the inaugural year of our turnaround."

▲ Expansion of renewable energy boosts opportunities in the ESS business

ESS is a facility that stores electricity generated from renewable energy sources such as solar and wind, and supplies it when needed. It is used to complement the characteristics of renewable energy, whose generation varies with weather conditions, and to enhance the stability of power grid operations.

Samsung SDI views the increase in ESS demand driven by the transition to carbon neutrality as a business opportunity. In its sustainability report, the company identified the expansion of electric vehicle and ESS product sales, driven by global carbon neutrality initiatives and rising energy demand, as an opportunity factor in addressing climate change.

CEO Choi stated, "Based on our outstanding prismatic battery technology and safety technology, Samsung SDI is leading the battery market for energy storage systems (ESS), which is at the core of the eco-friendly energy market."

The expansion of AI data centers is also impacting battery demand. Data centers utilize uninterruptible power supplies (UPS) and battery backup units (BBU) to ensure stable power supply. In its third-quarter earnings release this year, Samsung SDI noted that increased sales of ESS and BBU products drove the improvement in its battery business performance.

The company is also conducting research and development to expand its ESS business. In its sustainability report, Samsung SDI identified extending the lifespan of ESS batteries and ensuring price competitiveness as key R&D directions. The company plans to strengthen product competitiveness through the development of LFP materials, optimization of product design, and improvements in processes and equipment.

▲ Greenhouse gas emissions reduced by 22.1%, but the transition to renewable energy remains sluggish

Samsung SDI is expanding its energy storage system (ESS) business while simultaneously promoting greenhouse gas reduction in the battery manufacturing process and the transition to renewable energy.

According to the "Sustainable Management Report 2026," Samsung SDI's combined Scope 1 and 2 emissions decreased from 1,345,532 tons in 2023 to 1,129,164 tons in 2024, and further to 1,048,485 tons in 2025. This represents a reduction of approximately 297,000 tons, or 22.1%, over the two-year period.

Scope 1, which refers to direct emissions, saw little change, decreasing slightly from 242,600 tons in 2023 to 242,521 tons in 2025. In contrast, Scope 2, which covers indirect emissions associated with electricity usage, dropped by 26.9% over the same period, from 1,102,932 tons to 805,964 tons.

The renewable energy transition rate rose from 27% in 2023 to 39% in 2024, but declined by one percentage point to 38% in 2025. Renewable energy consumption also fell from 1,035,043 megawatt-hours (MWh) in 2024 to 941,016 MWh in 2025.

Samsung SDI has set a goal to power 100% of its domestic and overseas operations with renewable energy by 2050. In 2025, the company signed additional power purchase agreements (PPAs) for its Ulsan site and entered into new contracts with its Malaysian subsidiary. Both sites are scheduled to receive renewable energy power supply by 2026.

The company is also working to reduce energy consumption in its manufacturing processes. Samsung SDI stated that it achieved a cumulative reduction of 57,000 tons of direct greenhouse gas emissions by 2025 through measures such as temperature control for dehumidifiers in dry rooms and optimizing energy usage on non-operational production lines.

The company explained, "We aim to contribute to the transition to a low-carbon society through continuous research and development of our key product, batteries, and to enhance corporate competitiveness by generating stable revenue."

Samsung SDI is also increasing the proportion of recycled materials in its battery production. The usage rate of recycled metals, including cobalt, nickel, and lithium, disclosed by the company rose from 12% in 2023 to 14% in 2024, and further to 15% in 2025.

The company is also building a data collection system to calculate the carbon footprint of its battery products. By the end of 2025, it completed the development of a system that automatically collects product-level data, and it will use this system to calculate and disclose the carbon footprint of its products.

Samsung SDI reported that it has secured ESS orders sufficient to operate production lines in the United States with Star Plus Energy (SPE) and in Ulsan, South Korea, by 2028. The company plans to expand its local production capacity in the U.S. and pursue additional long-term supply contracts.