LG Energy Solution Oracle AIDC order just 1 of many. Datacenters to form 18% of US ESS demand by 2032

Research evidence excerpt

LG Energy Solution Oracle AIDC order just 1 of many. Datacenters to form 18% of US ESS demand by 2032

supplied multiple

other datacenters indirectly, including Microsoft/Prime Group. The Oracle/ Quarterly Forecasts (FYE Dec)

DTE order is in-line with our US ESS modeling assumption for 4 hour duration Adj. EBIT (W bn)

ESS for most AIDCs, although we model in a rise to 6 hour duration by 2032 2025A 2026E 2027E

(Figure 2USEV/ESbaterysuply-demandbalance-Datacenterstoform12%ofESdemandby2030). BBUs are optional and less common in today’s datacenters, but we Q1 375 (208)

Q2 492 86

forecast this to rise to 25 Gwh by 2035 (cumulative), forming 1% of the US ESS Q3 601 589

addressible market size (annual), and 11% of AIDC battery demand Q4 (122) 826

(cumulative). FY 1,346 1,286 3,745

• About LGES contract with DTE: According to local media (Chosun) and Style Exposure

company announcements, LGES has signed a $1.6bn, 2-year contract to supply

6 Gwh of ESS batteries to DTE Energy. DTE Energy is a major Power and

Energy company in Michigan, which serves 2.3 million electricity customs and

1.3 million natural gas customers. It has electricity supply agreements with

multiple datacenters in the region, including Google and Oracle.

• Datacenters to form 12% of US ESS demand by 2030: As shown in Figure

2USEV/ESbaterysuply-demandbalance-Datacenterstoform12%ofESdemandby2030, in 2025, datacenters accounted for 6% of US ESS demand, and 2% of global.

We forecast US datacenter capacity rising to 135 GW by 2030, which might

require 80-100 Gwh of grid+ UPS battery and 8 Gwh of BBU. On an

annualized basis, this might contribute 23 Gwh of demand by 2030, or 12% of

the US ESS total.

• LGES likely boasts the largest US AIDC ESS order backlog globally;