Korean energy-solution company LS Industrial Systems (LSIS) said on Wednesday that it has acquired the energy grid tie (EGT) division of Parker Hannifin, the largest energy storage system (ESS) company in North America, to make a foray into the global smart-energy market. The ESS, which refers to equipment that stores electric energy and supplies it when necessary, is essential in renewable energy generation systems that do not have consistent amounts of power generation.
LSIS said it officially launched LS Energy Solutions under its North American subsidiary LS Energy Solutions to take over all of physical and intangible assets of Parker Hannifin’s EGT division. Although LSIS did not disclose the value of the deal, industry experts estimate it at around 20 billion won (18 million U.S. dollars).
Founded in 1917, Parker Hannifin is a Cleveland, Ohio-based manufacturer of aviation and heavy industrial machinery. Its EGT division, which has been in charge of the ESS business since 2007, is based in Charlotte, North Carolina and assessed to possess the world’s top-class technologies in designing and manufacturing power converting systems and ESS systems. The company is the largest ESS supplier in North America with total accumulated power supply of over 400 megawatts.
LSIS has been nurturing ESS as part of its smart energy business, the company’s new core business, since its chairman and CEO Koo Ja-kyun took office in 2008.
The ESS market is expected to grow rapidly with the growth of the renewable energy market. According to Bloomberg New Energy Finance, a global market research firm, the accumulated capacity for ESS globally is expected to reach around 125 gigawatts by 2030, which is roughly 66 times the 2016 level. Some experts project that eight countries including South Korea, the United States, and China will account for about 70 percent of the total capacity.
“With this acquisition, we've secured an outpost from where we can expand to overseas markets with LSIS innovative smart-energy technology,” Koo said. “First, we will achieve tangible business success from the North American market, which is a strategic region globally.”
Tae-Ho Hwang firstname.lastname@example.org