Israel headquartered solar inverter and battery storage supplier SolarEdge Technologies has started test production of battery cells at its 2GWh manufacturing facility Sella 2 in South Korea which will come in handy to build the company's supply chain resilience.
Located in the Eumseong Innovation City of Chungcheongbuk-Do, the new fab Sella 2 is expected to ramp up during H2/2022. Currently battery cells produced under test phase need to be certified.
SolarEdge said the battery cells manufactured at Sella 2 will be used by the company for its residential solar-attached batteries as well as for a variety of industries as mobile applications, energy stationary storage solutions (ESS) and UPS applications.
Underlining the importance of this fab in production that's named after the company's Founder Late Guy Sella, the management stated it will enable the company to have its own supply of lithium-ion batteries and infrastructure to develop new battery cell chemistries and technologies. In the future, it can scale the capacity to support growing needs for storage solutions in its portfolio.
"It allows us to own key processes in the development and manufacturing of advanced energy storage solutions for our solar core business and additional applications, while further securing the resilience of our supply chain. We are committed to growing our business in the energy storage market, as well as our investment in battery cell technology and cell manufacturing, further strengthening our storage product portfolio," said SolarEdge CEO Zvi Lando.
Presently, most stationary storage suppliers source their batteries from China or Korea, and sometimes they source battery cells from 3rd party suppliers to assemble into battery packs. With SolarEdge having its own cell fab, it brings down costs and also cushions itself against supply chain dynamics, much like vertically integrated battery storage supplier Tesla, LG or BYD. A positive for the company.
In early May, SolarEdge published its Q1/2022 results, showing strong demand for solar boosting its revenues to $655.1 million and significant increase in demand reported from Europe where it shipped 1.1 GW, followed by 721 MW to the US and 309 MW to rest of the world (see SolarEdge's Q1/2022 Financial Results)