Finance Association, April 14 (Reporter Liu Mengran) As a key part of the new power system, the energy storage market has entered a period of rapid development. The Zhongguancun Energy Storage Industry Technology Alliance predicts in the recently released “White Paper on Energy Storage Industry Research 2024” that by 2030, the cumulative installed capacity of China's new energy storage market will exceed 200 GW, with a compound growth rate of over 30% from 2024 to 2030.

As one of the largest energy storage exhibitions in the industry, the Financial Services Association reporter saw at the 12th International Energy Storage Summit and Exhibition (ESIE2024) that many leading component manufacturers such as Tianhe Solar (688599.SH), Jingke Energy (688223.SH), and Dongfang Risheng (300118.SZ) appeared, and they all occupied a large central position in their respective stadiums, and launched products covering many scenarios for large-scale storage, industrial, commercial and household use. The popularity was no less weak than that of specialized energy storage manufacturers.

Last year, module leader Jingke Energy made a high-profile announcement entering the energy storage circuit, “kicking the venue” at the energy storage exhibition, and proposed to “place the business in the same important position as photovoltaics.” At this year's exhibition, Jinko Energy-related business leaders once again mentioned in exchanges with the Financial Association and other media that they will continue to increase investment in the energy storage industry.

It should be noted that the explosion in demand in the energy storage market cannot cover up problems that still exist in the early stages of industrial development, and is accompanied by internal developments such as “price wars.” The head of the Tianhe Solar Energy business told the Financial Federation reporter that energy storage is more sensitive to costs and prices, but from the current stage of distribution and storage to future participation in peak frequency modulation, customers will definitely value the efficiency and stable operation of energy storage systems, and enterprises need to use the advantages of products to face competitive challenges in the industry.

Component manufacturers also focus on 300+ Ah large batteries

According to the organizer, the scale of the ESIE2024 exhibition was unprecedented. 12 themed pavilions were set up, bringing together 500+ first-line energy storage brands. A total of 200+ new energy storage products were launched on the ESIE platform during the exhibition. “Bigger” is already the main iteration direction for energy storage products.

On the eve of the exhibition, the Tianheng Energy Storage System released by Ningde Times (300750.SZ) has achieved a high energy of 6.25 WmH in a standard 20-foot container; Envision Energy uses self-developed 350Ah special batteries, and the 20-foot container capacity reaches 5.6 MWh under the function of “direct and direct integration”; Honeycomb Energy unveiled a 6.9 MWh short knife liquid-cooled energy storage system at the exhibition, but the external size reached 3.1 meters wide.

Greater capacity is inseparable from larger cell support. However, the Financial Services Association reporter noticed that although some manufacturers have already launched 500+Ah or even 700+ Ah oversized single cells during the exhibition, judging from the product launch, 300+Ah is still mainstream at this stage.

In fact, since high-capacity batteries can reduce the amount of structural components used per Wh in battery design, improve the space utilization rate of the design, reduce the BOM cost of the battery cell, and also help reduce operation and maintenance costs at the system integration end. However, considering the corresponding increase in the risk of heat loss of control, manufacturers tend to be cautious about using larger batteries.

During this exhibition, a number of photovoltaic module manufacturers also launched energy storage products suitable for various scenarios. Trina Solar announced mass production of the next-generation flexible energy storage battery compartment Elementa2, which will begin delivery in May this year. In terms of parameters, with self-developed 314Ah high energy density batteries, 20 feet/5 MWH capacity and cost balance can be achieved, and the electricity cost of the energy storage system can be reduced by 32%.

Jinko Energy also launched the Blue Whale 5 MWh large storage system with “ultra-quiet” characteristics. The noise is controlled within 75db to reduce the impact of the energy storage system on the surrounding environment during use. In terms of cells, 314Ah lithium iron phosphate batteries are used, and the size is a standard 20-foot container structure. The energy storage system will have the conditions to accept orders for mass production of the project by the end of May. In addition, the first 5 GWh energy storage cells will be officially put into operation in the third quarter of 2024, and the conditions for mass production and shipment are in place.

Wu Dianfeng, general manager of Jinko Energy Products Center, said during the exchange that energy storage must be a trend in the future development of the electricity market. In his view, photovoltaic storage is a pair of twin brothers. An increase in the photovoltaic ratio must be supported by strong energy storage support in order for photovoltaics to account for a higher proportion of energy. Currently, the cost of photovoltaic power generation is already very competitive, but the current grid system cannot install a higher proportion of photovoltaics. At this time, energy storage will usher in accelerated development.

Continue to reduce costs and accelerate the promotion of energy storage

“Optical heat storage” first benefited from the explosion in demand for energy storage.

According to statistics from the Zhongguancun Energy Storage Industry Technology Alliance, by the end of December 2023, China had put into operation a total of 34.5GW/74.5GWh of new energy storage, with a year-on-year increase of more than 150%; in 2023, China put into operation 21.5 GW/46.6 GWh of new energy storage, three times the level of additional operation scale in 2022.

Faced with the volatile nature of new energy wind power generation, energy storage is seen as one of the important ways to solve this problem. Although the current problem of unclear energy storage revenue models has yet to be solved, as prices in the industrial chain drop and product performance improves, integrated optical storage can still bring good benefits.

According to Sun Wei, president of Tianhe Energy Storage, if the initial design of the product takes into account the deep integration of optical storage, the conversion between energy sources will be reduced in the middle. He believes that the current model is photovoltaic power generation. The input is converted by inverter, then through energy storage, then inverted conversion, and two inverted conversions in the middle. If deep coupling is implanted in the early stages, losses during the energy conversion process can be reduced.

Industrial and commercial storage machines are in high demand, but safety and cost have always been thresholds that cannot be circumvented. In terms of cost, batteries account for nearly 60% of the total cost of energy storage systems, which is also the most significant reduction. According to CNESA data, at the beginning of 2023, the average price of energy storage cells was still 0.9 yuan to 1.0 yuan/Wh. According to statistics from industry agencies, the price of 280 energy storage cells has fallen below 0.4 yuan/Wh since this year, officially entering a new era of 0.3 yuan/Wh.

However, the price does not seem to have “bottomed out”, and there are still expectations that energy storage costs will continue to decline. Tian Qingjun, senior vice president of Envision Group, said that in the decline in energy storage costs, lithium iron phosphate is only part of the reason; much of it is done through technological innovation and process innovation. He judged that in the future, the cost of energy storage will definitely drop to less than one dime, and the electricity cost of new energy+ energy storage can be reduced to less than three cents, changing from an unstable power source to a stable power source.

“Whether it's a long life or a high energy efficiency ratio, it all comes down to cost.” Sun Wei believes that for owners, reducing initial investment costs, reducing delivery and operation and maintenance costs, and ultimately increasing revenue throughout the life cycle, this is the greatest contribution.

According to the “White Paper on Industrial and Commercial Energy Storage Solutions” released by Sunshine Power (300274.SZ) and the Beijing Jianheng Certification Center, China's industrial and commercial energy storage profit model is dominated by peak and valley arbitrage, and has various models such as demand control, demand-side response, backup power supply, and electricity market transactions. According to statistics, as of 2023, there are about 25 regions with an average peak-to-valley price difference of 0.7 yuan/kWh. More than 20 provinces support two charges and two releases in a single day. The room for arbitrage has been further expanded, and the economy is prominent.