LG Chem to power China battery plants with 100% renewable energy

South Korea’s LG Chem Ltd. says it is powering its two battery component plants in China with 100% renewable energy purchased from Chinese power generators.

The petrochemical and electric-car battery unit of LG Group said on Tuesday that its precursor plant in Quzhou, Zhejiang Province, China has signed a third-party power purchase agreement (PPA) to receive 50 GWh of renewable energy annually from Zhejiang Zheneng Electric Power, the largest power generation company in the province.

The deal will help eliminate 35,000 tons of carbon emissions, an amount equivalent to emissions by 14,000 internal combustion engine vehicles a year, according to the company.

The move follows LG Chem’s announcement in December last year that it is powering its anode material plant in Wuxi with renewable energy.

The company said at the time it signed a contract to procure 140 GWh a year of renewable energy from Jiangsu New Energy Development Co. under a PPA agreement to power its battery materials plant in Wuxi, Jiangsu Province.

Precursors and anodes are key materials used to make rechargeable batteries.

RE100 INITIATIVE

With its latest PPA deal, LG Chem said it has achieved the RE100 status in its entire value chain for battery materials in China.

The RE100 or Renewable Electricity 100 initiative was first launched by British non-profit organization The Climate Group in 2014, and currently has more than 260 member companies around the globe, including Google, Apple, Ikea and General Motors.

The campaign, which targets companies that use more than 100 GWh per year, prompts them to transition to using 100% renewable energy by 2025 at the earliest.

Korea’s big conglomerates, including LG, SK and Hanwha, have also declared their carbon-free vows to comply with the government’s initiative to introduce environmental, social and governance (ESG) standards and achieve carbon neutrality by 2050.

In Korea, SK Group became the first business conglomerate to officially join the RE100 initiative in November 2020.

KOREA’S FIRST CHEMICAL FIRM WITH ZERO CARBON VOW

In July this year, LG Chem was the first Korean chemical company to announce a carbon neutrality plan aimed at producing zero carbon by 2050.

“As a leading ESG company, we will actively pursue ways to accelerate our shift toward RE100 at all of our workplaces worldwide,” LG Chem Vice Chairman Shin Hak-cheol said in a statement on Tuesday.

LG Chem said it has procured a total of 337.2 GWh of renewable energy in Korea and abroad, equal to the amount of electricity used by about 80,000 four-person households a year.

Analysts say that joining the RE100 initiative will help improve a company’s export competitiveness, given the tightening global eco-friendly regulations.

Write to Kyung-Min Kang at Kkm1026@hankyung.com
In-Soo Nam edited this article.