SEOUL, Nov 4 (Reuters) - South Korea's Samsung SDI

is discussing supplying ESS (Energy Storage System)

batteries to Tesla in an order reported to be worth

around 3 trillion won ($2.11 billion) or more.

The deal, if signed, would mark the latest push by Tesla

to reduce reliance on China for key parts. Tesla has signed

deals with South Korean companies, Samsung Electronics ( SSNLF )

and LG Energy Solution, to source chips

and batteries in recent months.

South Korean battery makers are also scrambling to

repurpose electric vehicle battery production lines to produce

energy storage systems, hit by the elimination of U.S.

subsidies.

Samsung SDI said during an earnings call earlier this

month that it has seen a big fall in battery demand from joint

venture partner Stellantis ( STLA ), and will convert some of

its EV production lines in the U.S. state of Indiana to make

ESSs.

South Korean newspaper the Korea Economic Daily said on

Monday that Samsung SDI had reached an agreement to supply Tesla

with ESS batteries over three years.

Tesla did not have an immediate comment.