As the electricity market has grown rapidly, industrial and commercial users have become pivotal players in energy storage, influencing both the supply and demand sides. It is evident that their involvement in electricity trading is imperative. Currently, domestic industrial and commercial energy storage is in a phase of robust development, with numerous projects already operational.
In recent developments, MS Energy’s commercial and industrial energy storage projects with a capacity of 1.2MWh have been successfully integrated into the grid.
On October 27th, Desay completed and commenced production of its energy storage projects in Huinan Park, boasting an impressive capacity of 5.175MW/10.062MWh. Furthermore, on October 15th, the largest commercial and industrial energy storage projects (19MWh) in Foshan were officially connected to the grid and put into operation.
According to the statistics, nine provinces, including Zhejiang, Jiangsu, Guangdong, Shandong, and Anhui, have reported a total of 243 user-side energy storage projects. The top three provinces in terms of project submissions are Zhejiang (with 108 filed projects), Jiangsu (57 filed projects), and Guangdong (51 filed projects). Specifically, Zhejiang province’s installed capacity has exceeded 114.1MW/438.8MWh, with an investment exceeding 580 million yuan. Similarly, Guangdong’s installed capacity has surpassed 126.1MW/255.2MWh, with an investment exceeding 400 million yuan.
On the market front, the decreasing costs have sparked a surge in demand, propelling the energy storage sector into rapid growth. Consequently, commercial and industrial companies have witnessed a substantial year-on-year increase in their revenue. As the industry flourishes, an increasing number of publicly traded companies are channeling their investments into the energy storage sector, both in primary and secondary markets. Moreover, numerous listed companies are planning to venture into the energy storage business.
The competitive landscape for energy storage companies has evolved significantly following their explosive growth. Industry experts suggest that a trillion-dollar-level competition in the energy storage sector has only just begun. The recent three years are considered a strategic window in the energy storage market, and those companies capable of faster and more effective development stand to secure a prominent position in the future market. Additionally, to meet the national dual-carbon objectives, the government has implemented electric power policies aimed at bolstering industrial and commercial energy storage by diversifying profit sources and advancing the commercialization process. Consequently, the policy landscape for industrial and commercial storage is becoming increasingly favorable.
On September 11th, CESA unveiled the 2023 White Paper on China’s Industrial and Commercial Energy Storage Development. According to the white paper, the global installed capacity for industrial and commercial energy storage is projected to reach 1.5GW in 2023, with a forecasted growth to 11.5GW by 2025. It is anticipated that by 2025, the total market size for global industrial and commercial energy storage will range from 19 billion to 24 billion yuan.
Guided by the dual-carbon strategy, industrial and commercial energy storage has emerged as a prominent trend.
This type of energy storage represents a typical application of user-side energy storage systems. Industrial and commercial users primarily install these systems to cater to their internal electricity demands and leverage peak-valley price disparities to engage in arbitrage, effectively reducing operational expenses. Currently, key application scenarios for industrial and commercial energy storage include factories, shopping malls, solar integration, energy storage and charging solutions, as well as microgrids.
Customers in the Energy Storage Industry
To expedite the adoption of industrial and commercial storage and hasten its commercialization, both the national government and provincial authorities have introduced auxiliary services, subsidies, and streamlined distributed power trading. These measures have created multiple revenue streams for operators, thereby fostering the development of industrial and commercial energy storage. In this way, the support of policies in various forms can greatly facilitate the advancement of industrial and commercial energy storage.
Competitive Landscape: Early Development Stage for Commercial and Industrial Energy Storage
At present, the industrial and commercial energy storage market is still in its infancy, resulting in a fragmented competitive landscape. A variety of players, including domestic and international energy storage giants, startups, and other companies, are actively entering this sector. Within the realm of industrial and commercial users, there is a broad spectrum of energy storage needs, spanning from several hundred kilowatt-hours to multiple megawatt-hours.
Product Information from the Official Websites of Major Industrial and Commercial Energy Storage Players
Key industry leaders such as CATL, Sungrow Power, Pylon Tech, Hyperstrong, and others have embarked on horizontal expansion strategies. They've introduced energy storage solutions designed specifically for small and medium-sized industrial and commercial users, featuring individual capacities ranging from several hundred kilowatt-hours. These companies have already established themselves with exceptional products in the large-scale energy storage and residential storage system categories. It's evident that they are diversifying their product lines by expanding horizontally into the industrial and commercial sector.
Small and medium-sized enterprises are capitalizing on the opportunities within the industrial and commercial energy storage sector by introducing products that incorporate liquid cooling, high integration, and advanced intelligence. This strategic move allows them to make inroads into the industrial and commercial energy storage market.
On the other hand, some major corporations like Tesla and BYD are catering to industrial and commercial customers by offering large-scale storage solutions. Although these companies have not showcased smaller cabinet-sized products on their official websites, they do provide substantial energy storage options for industrial and commercial clients. Notably, they have already implemented containerized solutions, where a single unit can deliver storage capacities at the level of megawatt-hours.
In summary, the industrial and commercial energy storage market is still in its early stages, featuring a multitude of players. The competitive landscape remains fragmented, and product standardization has yet to be fully established.
Presently, there is a robust demand for electricity within China's industrial and commercial sectors, with certain regions facing tight power supply and demand challenges. In 2022, the total electricity consumption in our society reached a staggering 8633.2 billion kWh, with industrial power consumption accounting for 5594.3 billion kWh. According to EPPEI’s projections, in 2023, six provinces in the country are expected to confront a severe power supply and demand shortfall, while 17 provinces may experience a somewhat tight power supply and demand situation. Electricity policies are amplifying the need for backup power, making industrial and commercial energy storage the preferred choice for businesses.
As a pivotal backup solution, the industrial and commercial energy storage system holds immense potential. Looking ahead, the key to maximizing benefits lies in conducting intelligent operations on complex, multi-faceted, and highly integrated systems. This pursuit of innovation in business models and technologies will be the goal of many leading enterprises.
In line with government policies, by 2025, industrial and commercial energy storage is set to embark on its developmental journey, equipped with the prerequisites for large-scale commercial adoption. Furthermore, advancements in electrochemical energy storage technology should drive a reduction in system costs by over 30%. Looking ahead to 2030, the new wave of energy storage is anticipated to achieve full marketization, underscoring the nation's unwavering commitment to the growth of industrial and commercial energy storage. In conclusion, the industrial and commercial energy storage market is poised for limitless development potential in the future.