U.S. Energy Storage Market Is Booming: What SK On’s 9 GWh Deal Means

The U.S. battery energy storage market is growing at an extraordinary speed.

And South Korea’s SK On is now moving deeper into that market.

On August 30, 2026, SK On announced a deal to supply U.S.-based NeoVolta Power with 9 GWh of lithium iron phosphate, or LFP, battery cells for energy storage systems between 2027 and 2032.

The batteries will be manufactured at SK On’s existing facility in Georgia. The companies are also considering an additional 9 GWh agreement, which could potentially increase their cooperation to 18 GWh.

This is important because the U.S. ESS market is no longer a small side business for battery manufacturers.

It is becoming one of the fastest-growing parts of the American electricity industry.

U.S. Battery Storage Capacity Is Growing Extremely Fast

According to the U.S. Energy Information Administration, utility-scale battery storage capacity in the United States reached nearly 52 GW by June 2026.

At the end of 2025, operational capacity was only 43.6 GW.

That means another 8.3 GW was added during the first six months of 2026 alone.

Even more impressive, U.S. battery storage capacity grew at an average annual rate of approximately 70% during the previous three years.

The growth is expected to continue.

Developers have reported plans to bring roughly another 54 GW of battery storage capacity online over the next two and a half years.

This tells us that battery storage is rapidly becoming part of mainstream U.S. electrical infrastructure.

Why Does America Need So Much Energy Storage?

One major reason is renewable energy.

The United States continues to install enormous amounts of solar generation.

Solar produces large amounts of electricity during the daytime, but power demand does not disappear when the sun goes down.

Battery energy storage systems can store electricity when generation is abundant and discharge that electricity later when demand is higher.

This becomes especially valuable during summer evenings.

Air-conditioning demand can remain extremely high even as solar generation begins to fall.

ESS can help bridge that gap.

Battery storage can also provide grid services including peak shaving, frequency support and backup capacity.

In 2026, U.S. developers planned approximately 24 GW of new utility-scale battery storage additions, making storage the second-largest source of planned new capacity after solar.

SK On Is Moving From EV Batteries Into ESS

SK On has traditionally been known primarily as an electric vehicle battery manufacturer.

But the battery industry is changing.

As EV demand growth has slowed and U.S. EV policy has become less favorable, Korean battery manufacturers have been looking for ways to use existing American production capacity more efficiently.

ESS provides one possible answer.

SK On’s new deal calls for pouch-type LFP cells to be manufactured at its Georgia facility and supplied to NeoVolta Power from 2027 through 2032.

The chemistry is also significant.

For stationary energy storage, maximum energy density is not always as important as it is in an electric vehicle.

Cost, cycle life, thermal stability and long-term reliability can be more important.

That is one reason LFP batteries have become increasingly important in the ESS industry.

My View From the Electrical Construction Side

From my perspective working in electrical construction, I think ESS is especially interesting because this market is much bigger than simply manufacturing battery cells.

A large battery system still needs to connect to an electrical system.

That means you also need equipment and engineering around the battery.

There are transformers.

Switchgear.

Power conversion systems.

Protection equipment.

Cables.

Monitoring and control systems.

Fire protection.

And eventually, grid interconnection.

In other words, installing more batteries does not automatically create a functioning energy storage system.

The battery is only one part of the electrical infrastructure.

This is why I think the growth of the U.S. ESS market could create opportunities far beyond battery manufacturers themselves.

As utility-scale storage grows, demand should also increase for electrical equipment, construction, engineering and grid infrastructure.

Why SK On’s Georgia Factory Matters

I think another interesting part of this deal is where the batteries will be produced.

They are expected to come from SK On’s existing U.S. manufacturing base in Georgia.

Local production matters because the United States is increasingly focused on building domestic battery and energy supply chains.

For SK On, existing factories also provide flexibility.

A battery plant built mainly for EV demand could potentially serve a rapidly growing stationary storage market instead of leaving production capacity underutilized.

From a business perspective, that makes sense.

The technology is different in some areas, but the company already has battery manufacturing facilities, workers and supply-chain experience in the United States.

If ESS demand continues growing while EV battery demand remains uncertain, this kind of production diversification could become increasingly common.

The U.S. ESS Market Is Already Setting Records

The growth is not only based on forecasts.

The U.S. installed 18.9 GW of energy storage in 2025, up 52% from 2024.

Then in the first quarter of 2026 alone, another 3.3 GW / 8.4 GWh of battery storage was installed, setting a new first-quarter record.

Texas, California and Arizona remain major markets, but storage development is also spreading into states such as Michigan and Georgia.

That geographic expansion is worth watching.

Battery storage is becoming less of a California-and-Texas story and more of a national U.S. grid story.

Final Thoughts

SK On’s 9 GWh deal is important, but I think the bigger story is the market behind it.

The United States already has nearly 52 GW of utility-scale battery storage capacity and developers are planning tens of gigawatts more.

At the same time, solar generation is expanding, electricity demand from AI data centers is increasing, and grid operators are looking for more flexible resources.

All of these trends point toward greater demand for energy storage.

For SK On, moving further into ESS could provide a new use for its U.S. battery manufacturing capacity.

For the electricity industry, however, the opportunity is even bigger.

The ESS boom will require not only batteries, but also transformers, switchgear, substations, power conversion equipment and electrical construction.

That is why I believe the U.S. energy storage market is becoming a story worth watching far beyond the battery industry itself.