At the right time for energy storage to go global, Chinese energy storage companies are actively expanding into overseas markets

August 22, 2024

In the great power game, energy comes first. Energy is not only the foundation of economic development, but also the core element of competition between countries.

In recent years, China’s photovoltaic and energy storage technologies have developed rapidly, with lithium energy storage batteries accounting for over 90% of the global market; Shenzhen has become a world-class center for the new energy storage industry, with nearly 7000 related enterprises and an annual output value exceeding 300 billion yuan.

Shenzhen Smart Manufacturing has become a business card for the global energy storage industry and a vivid portrayal of the high-quality development of Chinese enterprises.

China’s energy storage is far ahead

Energy storage refers to the conversion of electrical energy into other forms of energy (such as kinetic energy, potential energy, chemical energy, etc.) that are stored in energy storage devices and released when needed. The electricity generated by wind and solar power is unstable and intermittent. In order to be integrated into the power grid, energy storage technology needs to be used as a “transfer station” for regulation to mitigate the impact on grid equipment.

To address the issue of climate change, the Paris Agreement proposes that the world should achieve carbon neutrality by the mid-21st century. Currently, about 130 countries and regions around the world have responded to the carbon neutrality goal, and the penetration rate of new energy is accelerating globally. Major countries are stepping up their layout and seizing the opportunity.

The US Department of Energy (DOE) announced an increase in research and development investment in energy storage technologies, including lithium-ion batteries, solid-state batteries, and hydrogen storage. Federal and state governments have introduced tax incentives, subsidies, and loan programs to support energy storage development; The German government has introduced a series of support measures, including providing a 30% loan subsidy, offsetting personal income tax on energy storage equipment costs, etc., to encourage the public to install energy storage equipment; Australia has launched the National Battery Strategy, which provides tax incentives, financial support, and other measures to ensure the country’s economic development and energy security.

In September 2020, China announced to the world its goals of peaking carbon emissions before 2030 and achieving carbon neutrality before 2060, demonstrating its great power responsibility and strategic vision. China regards energy storage as an important means to achieve energy transformation and the “dual carbon goal”. The “Guiding Opinions of the National Development and Reform Commission and the National Energy Administration on Accelerating the Development of New Energy Storage (Draft for Comments)” proposes that by 2025, new energy storage will transition from commercialization to large-scale development; By 2030, achieve comprehensive market-oriented development of new energy storage.

In the global energy storage market, China has become an important pole, demonstrating increasingly significant international influence. According to statistics from the National Energy Administration, the cumulative installed capacity of new energy storage projects completed and put into operation in China in the first half of 2024 reached 44.44 million kilowatts/99.06 million kilowatt hours, an increase of over 40% compared to the end of 2023; According to data from GGII, by 2023, approximately two-thirds of the global installed capacity of power batteries will come from Chinese companies; In the field of energy storage, Chinese companies account for over 90% of global shipments of lithium energy storage batteries.

The international landscape is surging, and the strength of major powers is becoming increasingly mature. Relying on a strong domestic demand market and complete industrial and supply chain support, China’s new energy storage industry has formed manufacturing advantages, production capacity advantages, innovation advantages, talent advantages, and competitive advantages globally, becoming an important force influencing the global energy storage pattern.

The annual growth rate has doubled, and the global energy storage industry has a bright future

Faced with the challenges of climate change and the transformation of the global energy structure, the combination of renewable energy and energy storage technology will become an important direction for future energy development. More and more countries are actively adopting renewable energy to reduce carbon emissions, while utilizing energy storage technology to improve power reliability, which has become a significant trend in the world’s energy sector today.

The energy storage industry is a globally resonant industry and a necessary supporting industry for the development of new energy. Currently, countries around the world have development strategies related to new energy, so the industry has a bright future and we are optimistic about it in the long run, “said Wang Yu, Chairman of Far Eastern Energy Storage. Wang Yu introduced that the current energy storage market environment is good, and the demand in domestic and foreign markets is rapidly increasing, with an annual growth rate of 100% to 200%, full of vitality.

From the demand side, the global energy storage market presents a “three legged” situation, with the Chinese market, the American market, and other Asian, African, and Latin American countries each accounting for one-third of the market share, which will maintain strong demand for a long time. In 2023, China, the United States, and Europe will continue to announce an increase in the construction of renewable energy, and the application scale will continue to expand. The policy promotion of governments in various countries has also created a favorable environment for the application of energy storage technology. GGII also believes that the current global energy storage market has entered a period of reshuffle from a period of rapid development, and will continue to do so in the next 1-2 years.

From a production perspective, global energy storage equipment manufacturers are mainly concentrated in China, where related technological innovation and continuous cost reduction and efficiency improvement have entered a stage of high-quality development. The “China New Energy Storage Development Report 2024” shows that as of the end of 2023, China has put into operation new energy storage projects with an average energy storage time of 2.1 hours; The total new installed capacity in 2023 will increase by about 260% compared to the end of 2022, and the scale of new energy storage installed capacity will continue to grow rapidly.

Over the past decade, Chinese energy storage enterprises represented by “Made in Shenzhen” have actively participated in the construction of the initiative, demonstrating their strength and responsibility. In the process of expanding overseas markets, Chinese energy storage companies not only bring products and technology, but also deeply instill the concept of friendship and cooperation, becoming an important booster for promoting local economic development.

With the continuous growth of global demand for renewable energy and energy storage technology, the energy storage industry has ushered in unprecedented development opportunities. Looking ahead to the future, there will inevitably be more Chinese energy storage companies actively embarking on the journey of going global, constantly innovating, pursuing excellence, participating in construction with higher standards, and contributing Chinese wisdom and strength to the global energy transformation.