[Heavy&Chemical ON] LG Energy Solution, Evolving from Battery Cell Manufacturer to Energy Platform

Integration of In-House Company "AVEL"

Strengthening Integrated ESS Solutions Business

Proven Capabilities in AI-Based ESS Operations

LG Energy Solution is expanding its scope beyond battery supply to become an "energy platform company" that directly manages and operates energy. The company is pursuing a strategy to transform itself from a manufacturer supplying cells to an operator within the industry.

According to LG Energy Solution on July 18, 2026, the company recently carried out an organizational restructuring and integrated AVEL—previously an in-house independent company—into its Energy Storage System (ESS) division.

AVEL, established in 2022, has been focused on the integrated management of renewable energy power grids and the development of virtual power plant (VPP) technology. The company provides energy services that predict and control distributed renewable energy generation and enhance the efficiency and stability of power grids by connecting them with ESS. Now, as part of the ESS division, AVEL plans to further expand its integrated solutions business.

With this restructuring, LG Energy Solution aims to further strengthen its integrated ESS solutions business, which combines batteries and software. Powered by AVEL, LG Energy Solution became the first in Korea to establish and operate a distribution grid-connected ESS power plant in Seogwipo, Jeju in 2024. In particular, the company has focused on securing capabilities through experience in operating AI-based ESS. In the Jeju area, where there is a high amount of renewable energy generation, the grid has traditionally responded to excess power by restricting output through disconnecting generators from the transmission and distribution network. However, since LG Energy Solution began performing integrated management of ESS and power grids, the region has received praise for stabilizing the power system.

Industry experts predict that as small-scale solar power installations increase, the distribution lines may exceed their allowable capacity, leading to connection delays and output control issues. Consequently, it is expected that distribution grid-related businesses will grow further in the future. There is especially a growing demand to install ESS on distribution lines to manage excess power instead of expanding the distribution grid. By installing ESS on distribution lines, the grid’s capacity can be increased in a short period without the need for large-scale transmission network expansion.

LG Energy Solution’s latest decision reflects its ambition to become an energy platform company. The industry is paying attention, as this represents the first case of a battery cell manufacturer not simply delivering one-off supplies, but providing long-term operation—including operation, maintenance, and repair—over 20 years. LG Energy Solution was also recently selected as an operator for the government-led distribution grid ESS project in the Honam region. Out of a total of 32 distribution lines, the company secured the maximum possible seven distribution lines that one operator can manage. However, LG Energy Solution still faces the challenge of scalability, as its projects currently rely exclusively on its own batteries.

An LG Energy Solution representative commented, "Being selected for this project is a meaningful achievement in our process of evolving into an energy platform company that goes beyond battery manufacturing," adding, "By leveraging our AI-based ESS operational capabilities proven in Jeju, we aim to lead the future energy solutions market and contribute to the stabilization of the national power grid."

This content was produced with the assistance of AI translation services.