China aims to install more than 30 gigawatts (GW) of new energy storage capacity by 2025, and 100 GW finished by 2030 as part of efforts to boost renewable power consumption, with energy storage and electrochemical storage remaining critical for China’s energy transition and ensuring a stable electric grid system.
New energy storage refers to electricity storage processes that use electrochemical, compressed air, flywheel and super capacitor systems but not pumped hydro, which uses water stored behind dams to generate electricity when needed. Among all energy storage technologies, electrochemical storage is popular due to its maturity, simple structure, and deployment convenience and will very likely represent the majority of energy storage in future
China currently has total energy storage capacity of about 35 GW as of 2020, of which 31.79 GW is pumped hydro, and 3.269 GW is electrochemical storage. Lithium battery contributed 2.9GW, over 90% of the electrochemical capacity, according to the China Energy Storage Alliance. China is aiming for renewable power to account for more than 50% of its total electricity generation capacity by 2025, up from about 42% now.
Rising giants in storage technology.
CATL: Contemporary Amperex Technology Ltd. (CATL), the largest lithium-ion battery manufacturer in China, provides batteries for electric vehicles, and more recently, products and solutions for energy storage.
In 2018, CATL participated in a 50 MW/100 MWh storage project in Haixi prefecture, Qinghai province. In the same year, the sales revenue from its storage business increased by almost 12 times over the previous year. In 2019 and 2020, it recorded more than 200% growth year on year, reaching CNY 1.9 billion ($295 million) in 2020.
CATL’s storage solution covers major storage scenarios such as storage for power generation, grid storage, and storage on the consumption side. With high-quality battery cells and a in-house battery management system (BMS), CATL provides power generation customers accurately optimized assistance for grid-friendly power output. On the grid side, CATL’s storage system can help greatly in peak shaving and frequency regulation, to boost capabilities for renewable energy fluctuations. Meanwhile, the storage products have been applied in large-scale industrial, commercial and residential areas, and expanded to emerging scenarios such as base stations, UPS backup power, intelligent charging stations, and off-grid and island/isolated systems.
Sungrow: As one of the more significant solar inverter manufacturers and earliest enterprises involved in energy storage, Sungrow has applied its energy storage systems across China, the United States, Great Britain, Canada, Germany, Japan, Australia, India and more. By the end of June 2020, the company had taken part in more than 1,000 energy storage projects globally.
Based on its inverter technology, Sungrow concentrated on R&D to help customers to better support grids with fast power control/adjustment. To help customers minimize the levelized cost of electricity (LCOE), Sungrow promoted a storage system of 1,500 V and with a DC coupling scheme of PV and storage, which can significantly reduce the overall cost of a system.
According to China Energy Storage Alliance statistics about global energy storage projects, Sungrow is becoming the leading enterprise for providing the most comprehensive energy storage products in the field. The company has ranked first in China for storage installations for the past four consecutive years.
Veteran state-owned equipment manufacturer Shanghai Electric established a 2017 joint venture with Gotion Hi-tech, a lithium-ion battery supplier, for market exploration in energy storage and system solutions. The joint venture has expanded its R&D and sales in lithium battery precursors, cells, and battery management systems, and has delivered customized integration solutions for energy storage systems.
At end of 2018, the joint venture, Shanghai Electric-Gotion, began to build its own lithium battery production base in Nantong, Jiangsu province, for the future development of storage. Following 10 months of construction and equipment adjustments, the new facility started production of its first-stage project, with an annual capacity of 5 GWh.
At the 2021 SNEC expo in Shanghai, the company launched its latest storage solution. And its BMS for electrochemical energy storage won the Megawatt Jadeite Award for its innovative design.
Similar to Sungrow, Huawei commenced its expansion into storage by building on its significant inverter product expertise. However, the difference is that Huawei sees the move within a much bigger picture for the future of energy.
From Huawei’s string inverters, the company saw the possibility for its products to build up a network of solar PV, wind power, and smart energy grids. Based on this network, the future energy world, in Huawei’s view, will be centered on data and digital technologies.
In the future, the current grid will still provide physical support for electricity power transmission. Power consumers and generators will connect into the grid for power consumption, or contribution, through bidirectional inverters. Meanwhile, the inverter is also connected to a storage system to store surplus electricity or supply power to the grid based on price levels and grid demand.
The overall ambition is that these nodes are all connected via a cloud network. It’s possible that millions of interconnected nodes could then provide functionality and data. Huawei is aiming to become a platform that can provide all the necessary technologies, hardware, software, solution, and services. Storage system solutions are a starting point for Huawei in this wide-scale effort to reimagine energy infrastructure.
In summery, battery storage investment remains critica and long-term perspective of energy storage investment remains buoyant. The industry remains one of the most critical parts of China’s carbon neutrality plan.