According to Wechat Official Account @escn518, in the short four months of 2025, a series of new policies have been successively released at the national and local levels, ushering in an unprecedented "policy storm" for China's new energy industry and accelerating the transformation of the energy storage industry from "policy-driven" to "market-driven."
National Policies: End of Mandatory Energy Storage, Establishment of Market-Based Mechanisms
Previously, in February 2025, the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA) issued Document No. 136, explicitly stating that energy storage configuration should not be a prerequisite for the approval of new energy projects, ending the "mandatory energy storage" policy that had been in place since Qinghai first introduced it in 2017.
Industry insiders believe that Document No. 136 is an innovative measure to implement the "Renewable Energy Law" and the "Energy Law" under the new circumstances. On the one hand, it requires improving market transactions and pricing mechanisms and promoting the comprehensive entry of new energy into the power market and fair participation in transactions. On the other hand, it provides support for wind and solar new energy through the establishment of a "New Energy Sustainable Development Price Settlement Mechanism" (referred to as the "Settlement Mechanism" or "Mechanism") to promote the sustainable development of new energy.
The "Settlement Mechanism" will be a government-authorized contract for difference mechanism adapted to the Chinese power market. The implementation of this mechanism can promote the synergy between the government and the market, as well as the sustainable development of renewable energy. The significant significance of Document No. 136 lies in the fact that the government has begun to focus on solving problems such as market failures, encouraging new energy to actively participate in the market, proactively reduce the system's accommodation costs, allow the market to play a decisive role in resource allocation, restore power market prices, and promote the coordination of different policies.
On April 29th, the General Office of the National Development and Reform Commission and the General Department of the National Energy Administration issued the "Notice on 1 Comprehensively Accelerating the Construction of the Electricity Spot Market (Fa Gai Ban Ti Gai [2025] No. 394)," explicitly requiring that basic full coverage of the electricity spot market be achieved by the end of 2025.
The core of Document No. 394 is to solve the pain points of insufficient flexibility in the power system through market-based mechanisms. The document clearly requires the promotion of spot market construction province by province: Hubei, Zhejiang, and other 6 provinces and cities need to complete official operation by the end of 2025, Fujian, Sichuan, and other 16 provinces will start continuous settlement trial operation, and the southern region will simultaneously explore cross-provincial transaction mechanisms. Industrial and commercial users need to have the ability to independently declare and settle by the end of 2025, and spot market price signals will be directly transmitted to the end-use electricity link.
In terms of price mechanism innovation, the spot market adopts a 15-minute rolling clearing model. Zhejiang pilot data shows that the lowest electricity price during peak photovoltaic generation periods fell to -0.18 yuan/kWh, while the highest electricity price during evening peak hours reached 1.45 yuan/kWh, with intraday price differences generally exceeding 1.5 yuan/kWh. This institutional design upgrades energy storage from a traditional "peak shaving and valley filling" tool to a "dynamic balancer" of the power system, but it also raises the requirements for energy storage response speed and prediction accuracy to the minute level.
Obviously, this upcoming major test of the electricity market will not only reshape the entire power industry landscape but also profoundly change the business logic and development path of industrial and commercial energy storage.
Jiangsu New Policy: Time-of-Use Tariffs Are Not a Sure Thing for Industrial and Commercial Energy Storage
On April 30th, the Jiangsu Provincial Development and Reform Commission officially issued the "Notice on Optimizing the Time-of-Use Tariff Structure for Industrial and Commercial Users to Promote New Energy Consumption, Reduce Enterprise Electricity Costs, and Support Economic and Social Development." This adjustment increased the floating ratio of peak and valley electricity prices and added a midday trough period. The document will be implemented from June 1st.
The document clearly encourages industrial and commercial users to actively reduce electricity consumption during peak hours and increase electricity consumption during trough hours by configuring energy storage (蓄能) devices, carrying out comprehensive energy management, and other methods, thereby effectively reducing electricity costs by optimizing electricity consumption periods. It optimizes the time-of-use period settings for industrial and commercial users and adds a midday valley period. Valley electricity prices will be implemented from 11:00-13:00 (2 hours) in summer and winter (June-August, December-February each year) and from 10:00-14:00 (4 hours) in spring and autumn (March-May, September-November each year). Time-of-use period settings for industrial and commercial users: adjust the electricity price floating ratio, with the user's electricity purchase price as the flat period price, and float up and down based on this.
Regarding the question of how energy storage projects can actively adapt to the adjustment of the time-of-use tariff structure and achieve a new round of development, which is of most concern to the industry, the Jiangsu Development and Reform Commission replied as follows:
This optimization of time-of-use tariffs expands the scope of implementation of industrial and commercial time-of-use tariffs to electricity users who implement industrial and commercial electricity prices, except for electrified railway traction electricity with special national regulations, providing new potential industrial and commercial enterprise partners for energy storage projects. With technological progress and increased production capacity, the cost of energy storage projects continues to decline, which will also bring more profit space to energy storage projects. In addition, with the construction and development of the power market, energy storage projects can cooperate with new energy power generation projects to obtain market value by providing peak shaving for new energy power generation. After the normalized operation of the electricity spot market, it will better play the role of market price discovery and optimal resource allocation. The time-of-use price difference in market transactions will be further widened, and energy storage projects can also directly participate in the electricity market, especially spot market transactions, to obtain income through low charging and high discharging. During peak summer (winter) periods, energy storage projects can also participate in the province's electricity demand response as load aggregators or virtual power plant users, further increasing revenue.
Some experts believe that the formation of time-of-use tariffs in various provinces needs to consider multiple purposes, but the development of industrial and commercial energy storage is not its primary purpose, let alone a sure thing. The decision-making cost of adjusting local time-of-use tariff policies is often lower than adjusting power energy storage policies, and the closer the connection between the time-of-use tariff structure and power market price signals, the more conducive it is to achieving all the main objectives in Document No. 1093, and the stability of its administrative order-like nature becomes increasingly difficult to maintain.
In fact, Jiangsu is not the first and will not be the last to use the "user's electricity purchase price" as the pricing basis. In the future, energy storage companies will inevitably rely more on market-based mechanisms and technological innovation, and different application scenarios will also put forward more differentiated requirements for energy storage technology, continuously promoting the industry towards refined development. For future industrial and commercial energy storage, high-quality owners are scarce resources, excellent operators are key roles, and the resulting multi-type operating income is the direction that industrial and commercial energy storage should rapidly break through.
New Policy Guidance: Shift in Local Subsidies, Stricter Safety Supervision
Obvious Signals of Shift in Local Subsidies
At the same time, local subsidy policies are also shifting from "installed capacity" to "discharge volume" and "technological breakthroughs." For example, the Inner Mongolia Energy Bureau issued the "Notice on Accelerating the Construction of New Types of Energy Storage," which provides compensation for the discharge volume of independent new energy storage power stations included in the autonomous region's plan to the public power grid. The compensation standard is determined annually, and the compensation standard for 2025 is 0.35 yuan/kWh, with an implementation period of 10 years.
It is understood that as early as November 2023, the Inner Mongolia Energy Bureau issued the "Implementation Rules (Trial) for Independent New Energy Storage Power Station Projects in Inner Mongolia Autonomous Region," pointing out that grid-side independent energy storage power stations included in demonstration projects enjoy capacity compensation, with a compensation cap of 0.35 yuan/kWh based on discharge volume and a compensation period of 10 years. At that time, the policy still required distinguishing between grid-side and power-source-side energy storage. Power-source-side energy storage obtained income through capacity leasing and sales, and the document did not propose an annual compensation standard. The "Notice" further abolished the division between power-source-side and grid-side, and all independent energy storage power stations enjoy capacity compensation.
In addition, new subsidy policies such as Wenzhou Ouhai District in Zhejiang providing a subsidy of 0.8 yuan/kWh for user-side energy storage based on discharge volume, Shanghai Songjiang District providing tiered incentives for virtual power plant response based on regulation volume, and Changzhou in Jiangsu providing a maximum subsidy of 0.3 yuan/kWh for new energy storage power stations have been implemented.
Stricter Safety Supervision of Energy Storage Power Stations
On May 7th, the National Energy Administration and five other departments jointly issued the "Notice on Strengthening the Safety Management of Electrochemical Energy Storage." The notice proposes to improve the intrinsic safety level of battery systems, carry out safety condition and facility demonstration and evaluation for electrochemical energy storage projects, further improve relevant standards and specifications for electrochemical energy storage, implement safety supervision responsibilities for electrochemical energy storage projects, strengthen inter-departmental work coordination and information sharing, and implement the main responsibility of enterprises for safe production.
This includes improving the intrinsic safety level of battery systems; carrying out safety condition and facility demonstration and evaluation for electrochemical energy storage projects; further improving relevant standards and specifications for electrochemical energy storage; implementing safety supervision responsibilities for electrochemical energy storage projects; strengthening inter-departmental work coordination and information sharing; and implementing the main responsibility of enterprises for safe production.
Previously, various provinces and cities have introduced a number of management regulations for fire protection and grid connection acceptance of energy storage power stations. For example, Sichuan requires eliminating "grid connection with defects," Guangdong clarifies the fire safety responsibilities of energy storage power stations, and the East China Energy Regulatory Administration's "strictest safety order" draws a red line—energy storage power stations in densely populated areas and high-rise buildings must be shut down, and non-compliant projects will be forced to exit before 2025. The national level has also included battery cell production date and accident records in bidding assessments, forcing companies to improve product quality, which has also led to an accelerated increase in industry concentration.
Industry Trends: Increased Concentration, Accelerated Overseas Expansion of Chinese Enterprises
Under the influence of policy shifts, technological iterations, price competition, and other multiple factors, the energy storage industry continues to show a trend of stronger leading enterprises and shrinking living space for small and medium-sized manufacturers. Data shows that in 2024, the CR10 (concentration ratio of the top 10 enterprises) of the energy storage cell industry exceeded 90%, and the CR10 of integrators exceeded 80%.
With the full operation of the electricity spot market in 2025 and the accelerated clearing of inefficient production capacity, a large number of enterprises lacking technological barriers and capital reserves will disappear, while some leading enterprises with technological advantages and strong financial strength will further expand their advantages. It is expected that the market share of the top 10 energy storage enterprises will further increase in 2025.
While domestic policies are undergoing drastic changes, energy storage demand in Europe, the United States, the Middle East, and other markets is surging. Some institutions predict that overseas large-scale energy storage installations will double in 2025. Leading enterprises have accelerated their overseas expansion. For example, BYD Energy Storage's market share in Europe has exceeded 25%, EVE Energy's North American orders have soared by 300%, Vision Energy has secured a 240 million pound energy storage order in the UK, and CATL has consolidated its advantages through deep ties with Tesla. At the same time, small and medium-sized energy storage enterprises are flocking to emerging markets such as Asia, Africa, and Latin America to break through and survive, making the overseas market in 2025 already a red sea.
Conclusion
Industry insiders believe that in the process of building a new type of power system in China, the rapid development of new energy promotes the transformation of the power structure, followed by the continuous optimization of time-of-use tariff policies in various provinces, and finally promotes the richer value connotation of energy storage. This is an inevitable historical process for the energy storage industry to enter a rational development period.
In the long term, after the relaxation of policies, models such as independent energy storage power stations and virtual power plants are expected to become mainstream, and the energy storage industry will also move from "barbaric growth" and "crazy involution" to high-quality competition and differentiated competition, providing a more solid support for helping the country achieve its "dual carbon" goals and build a new type of power system. Therefore, the series of "policy storms" from Document No. 136 to Document No. 394 is not the end of energy storage, but the starting point for the construction of a new type of power system.
Source：https://mp.weixin.qq.com/s/_vYa0SbZK96pkzIlqO2WVQ