(Bloomberg) -- A deadly factory blaze has revived concerns over battery safety in South Korea, a key global supplier of lithium-ion cells used in everything from electric vehicles to energy storage systems. 

The fire and a series of explosions at a lithium battery plant south of Seoul killed 23 workers and left eight injured on Monday, according to the government. While the plant produced primary lithium cells, which are made for single use, the blaze risks souring sentiment in the country toward the entire industry that has been plagued by a series of fires over the years.

Korea’s government is responding by forming a pan-government taskforce, including civilian experts, to produce fundamental improvements to fire safety measures, according to the Ministry of Trade, Industry and Energy on Tuesday. 

The incident can dent broader “sentiment toward the EV battery industry,” said Bang Sungyong, chief executive officer at Grinergy, a startup that makes lithium-titanium cells. Even though the batteries that caused the fire are not rechargeable ones that go into EVs, the industry needs to develop technologies for safer batteries, he added. 

Even as Korean suppliers of batteries — LG Energy Solution Ltd., SK On Co. and Samsung SDI Co. — lead the global manufacturing of power cells, they have struggled to deploy energy storage systems (ESS) across the country due to a series of blazes. While the government has introduced tougher regulations, frequent accidents have slowed the installment of ESS, which are critical in helping make solar and wind power more reliable and ubiquitous. 

Battery-related fires have also posed greater risks in recent years as countries pivot away from fossil fuels and expand the use of clean energy and vehicles. The growing demand has increased the number of battery producers around the globe, with fires breaking out everywhere from the US to Australia. 

News of Korea’s explosion drove home the importance of safety in the industry as it expands, said Robin Zeng, chairman of Contemporary Amperex Technology Ltd. He added that he was worried that having so many players in the sector meant that some didn’t have the technology to solve their safety problems.

“When millions of people are using batteries, if the batteries aren’t safe enough it will cause a lot of problems,” he said at a World Economic Forum event in Dalian, China, on Tuesday. 

The blaze broke out at about 10:30 a.m. Monday at the three-story plant in Hwaseong, about 45 kilometers (28 miles) south of Seoul. Most of the victims were migrant workers from China. 

Shares of S Connect Ltd. — which owns 96% of Aricell, where the fire broke out — dropped 2.9% Tuesday, after plunging 23% on Monday.

--With assistance from Shinhye Kang.

(Updates with details throughout.)

©2024 Bloomberg L.P.