Domestic large-size energy storage has seen significant growth and strong demand in recent months. According to public statistics, in July, the bidding capacity of energy storage has surpassed June's capacity by 143% and 150%. The average price of energy storage systems in July is 0.99 yuan/Wh, with prices ranging from 1.09 to 1.95 yuan/Wh. The majority of prices fall within the range of 1.18 to 1.4 yuan/Wh. In June 2023, the overall average price of energy storage systems reached 1.13 yuan/Wh, reflecting a 20.3% increase compared to the previous month, with prices ranging from 0.985 to 1.74 yuan/Wh. Most of the prices were between 1.2 to 1.5 yuan/Wh. The total winning bidding capacity of EPC energy storage systems in June 2023 was approximately 1.55GW/3.41GWh, showing year-on-year increases of 26.2% and 29.98%, and month-on-month increases of 13.93% and 8.18%. The bidding capacity of EPC energy storage systems from January to June reached 11.4GW/22.6GWh, demonstrating substantial year-on-year growth rates of 186.4% and 217.4%. In terms of application scenarios, the total capacity of winning bids on the power supply side accounted for around 24.8% and 24.4%, while the total capacity of winning bids on the power grid side accounted for approximately 75.1% and 75.6%.
In the long term, the domestic business model of large-size energy storage is expected to have a positive impact due to the acceleration of new power system construction. This will lead to smoother profit models for the industry, and industrial and commercial storage will benefit from the decline in lithium carbonate prices and the larger price gap between peak and valley electricity prices. Consequently, the economics of industrial and commercial energy storage will be further enhanced. According to CNESA data, the added installed capacity of energy storage in June was 3.5GW/7.2GWh, while in Q2, the figures reached 5.9GW/12.3GWh, marking impressive month-on-month growth rates of 96.7% and 105% respectively. The power is 15 times higher as well. This significant increase can be attributed to the comparison with the same period last year when supply chain prices were high, leading to lower new energy storage installations. From January to June in 2023, the added installed capacity of energy storage reached 8.9GW/18.3GWh, exceeding last year’s figures of 7.3GW/15.9GWh. The energy storage industry is booming and has exceeded expectations. However, it is important to note that the competition in the bidding market for domestic large-size energy storage has intensified this year.
European household storage: As of July 22nd, 2023, the German electricity spot price is currently at 76.73 euros/MWh, with the average weekly price showing a week-on-week decrease of 7.51%. On the other hand, the German electricity futures price is at 141.94 euros/MWh, with the average weekly price increasing by 4.84% compared to the previous month. The Dutch natural gas spot price and future gas price stand at 27.45 euros/MWh and 52.97 yuan/MWh respectively, showing a week-on-week drop of 8.46% and a week-on-week of 1.78% respectively. These fluctuations in prices are mainly attributed to two factors. Firstly, there has been a government call for energy saving, which may have led to decreased electricity demand in some areas. Secondly, excessive electricity tariffs in various parts of Europe have also contributed to reduced demand. Therefore, it is expected that the electricity tariff in Europe will fluctuate at a low level.
In the first half of 2023, Germany witnessed a remarkable surge in new installed energy storage capacity, reaching 2.15GWh, representing a significant year-on-year increase of 138.9%. The installed capacity of large-size storage, industrial and commercial storage, and household storage reached 106.26MWh, 59.47MWh, and 1980MWh, respectively. These figures reflect impressive year-on-year growth rates of 153.7%, 62.7%, and 140%, respectively. Notably, the European household storage market has seen notable improvements in the inventory of distribution channels. However, our investigation reveals that new orders for household storage remain somewhat sluggish. Nonetheless, we anticipate a gradual increase in orders during the second half of the year. This expectation is supported by the easing of tensions in the Russian-Ukrainian conflict and the gradual relaxation of policies across Europe. Looking ahead, the growth rate of installed household storage in Europe is projected to decelerate in 2023 compared to 2022. Despite this anticipated slowdown, the sector is still expected to maintain a relatively high growth rate.
U.S. Energy Storage: In Q1 of 2023, the added installed capacity of energy storage in the United States was 0.78GW/2.145GWh, showing a year-on-year decline of 11.3% and 22%, and a month-on-month drop of 27% and 29%. The FTM (Front-of-the-Meter) market remained the primary source of new energy storage installations in the U.S., accounting for 70.5% and 72.3% of the total. However, the added installed capacity in the U.S. FTM market in Q1 2023 reached only 0.55GW/1.55GWh, indicating a significant decrease of 25.8% and 35.3% year-on-year and a sharp drop of 34.8% and 38.1% month-on-month. This decline can be attributed to the impact of supply chain disruptions and grid connection restrictions, which led to the postponement of over 1.8GW of originally planned energy storage projects in Q1. Notably, California and Texas contributed to 84% of the new installations in the FTM market.
In the same quarter, the added installed capacity of U.S. residential energy storage reached 155MW/388MWh, showing a year-on-year increase of 7.15% and 16.2%, but a month-on-month decrease of 9.1% and 9.3%. This marked the first time in two years that residential storage installations declined month-on-month, breaking the momentum of maintaining consecutive quarter-on-quarter growth for six quarters.
On a more positive note, in Q1 of 2023, the added installed capacity of U.S. commercial and industrial energy storage was 69MW/203MWh, demonstrating a year-on-year increase of 9.7% and 43%, and a substantial month-on-month growth of 44% and 111.8%. This is a welcomed rebound after four consecutive quarters of below-average installed capacity. The increase is mainly attributed to the realization of grid-connection for projects that had been delayed in the previous period.
