Samsung SDI said Tuesday that it would set up a joint venture with Sungrow Power Supply, a China-based inverter manufacturer, for energy storage systems in China next year.

The South Korean IT materials giant and its Chinese partner finalized the decision on Tuesday to establish the ESS joint venture in the first half of 2015 following their initial agreement last August.

The two companies will aim to build their presence in China’s ESS sector, which has become the world’s largest market amid the country’s increasing promotion of energy efficiency.

They seek to secure an ESS market share of 30 percent through the joint enterprise, without giving a target date.

They said, however, that the joint venture would invest in new ESS manufacturing centers in China where the market capacity of lithium-ion ESS is expected to reach 280 megawatt-hours, accounting for over 20 percent of the world’s total by the end of this year.

“We will prepare gradually and step up efforts to become one of the leading ESS companies in China, which is expected to grow rapidly in the near future,” said Samsung SDI CEO Park Sang-jin in a press release.

The joint venture will focus on developing a system and lithium-ion battery packs for energy storage, as well as marketing and sales of its ESS solutions and products, Samsung SDI said.

Sungrow Power Supply, founded in 1997 by chairman and president Renxian Cao, is China’s biggest company in solar photovoltaic inverters with more than a 30 percent market share. It is also the world’s second largest in the field, according to Samsung SDI.

The Korean materials company said the joint venture would aim to generate business synergy with Samsung SDI’s electric car battery manufacturing center, which will be built by October 2015 in Xian, China’s Shaanxi province.

ESS is a system built mostly to accommodate renewable energy plants such as wind and solar power for efficient and stable power distribution and operations.

By Park Hyong-ki (hkp@heraldcorp.com)