What’s new: Chinese manufacturers of batteries used in energy-storage projects should double down on their overseas expansion as they face a supply glut and fierce competition at home, according to a new white paper.
Companies can export more products or localize production overseas, according to the document jointly released by the China Energy Research Society and the China Energy Storage Alliance on Wednesday.
In 2023, shipments of Chinese-made batteries used for energy storage reached around 200 gigawatt-hours (GWh), but last year’s global newly installed energy storage capacity was only 100-120 GWh, the white paper said.
The background: Competition in China’s energy storage market is heating up.
In 2023, “tens of thousands” of companies entered the industry, with the combined capacity of planned and under-construction factories intended to produce energy-storage batteries reaching 1,172.5 GWh, according to the white paper.
Despite this rush of new entrants, the market remains dominated by the top players, with industry leaders like Contemporary Amperex Technology Co. Ltd. and BYD Co. Ltd. winning more than half of China’s new energy-storage projects in 2023, according to the white paper.
Projects’ margins have been squeezed across the industry. In February, the average price that companies bid for energy-storage projects in China was 0.9 yuan per watt-hour, up 15% month-on-month but down 37% year-on-year, according to data obtained by Caixin.
Energy-storage batteries are commonly used in renewable power facilities, to store the excess energy generated when demand for energy falls below the level being generated by the facility.
Contact reporter Ding Yi (yiding@caixin.com) and editor Joshua Dummer (joshuadummer@caixin.com)
