A Summary of Energy Storage Development in the First Half of 2018

Electrochemical Energy Storage Maintains Rapid Growth

According to the CNESA Global Energy Storage Database, in the first half of 2018, global newly operational electrochemical energy storage project capacity totaled 697.1MW, an increase of 133% from the same time the previous year, and an increase of 24% since the end of 2017.  China’s newly operational electrochemical energy storage project capacity for the first half of 2018 totaled 100.4MW, 14% of the total new global capacity.  This new capacity reflected an increase of 127% from the previous year, and an increase of 26% since the 2017 year’s end.

 Figure 1: global new operational electrochemical energy storage project capacity (2018.H1, MW)

Figure 1: global new operational electrochemical energy storage project capacity (2018.H1, MW)

 Figure 2: China’s new operational electrochemical energy storage project capacity (2018.H1, MW)

Figure 2: China’s new operational electrochemical energy storage project capacity (2018.H1, MW)

In comparing by distribution of technologies, in both global and Chinese markets, newly added energy storage capacity was dominated by Li-ion batteries, at 99% and 94% of the total, respectively.  In applications, ancillary services dominated the global market’s new energy storage capacity, at 51%, while China’s market saw grid-side energy storage dominate, at 42%.  In a regional comparison, the United Kingdom showed the greatest increase in both newly added capacity and in comparative growth with the same time the previous year (2017.H1).  The United Kingdom’s newly added capacity totaled 307.2MW, nearly 45% of the global market, an increase of 441% in comparison to 2017.H1.

 Figure 3: distribution of global operational electrochemical energy storage by application (2018.H1, MW)

Figure 3: distribution of global operational electrochemical energy storage by application (2018.H1, MW)

 Figure 4: distribution of China’s operational electrochemical energy storage by application (2018.H1, MW)

Figure 4: distribution of China’s operational electrochemical energy storage by application (2018.H1, MW)

 Figure 5: global distribution of operational electrochemical energy storage by region (2018.H1, MW)

Figure 5: global distribution of operational electrochemical energy storage by region (2018.H1, MW)

Global Competitors Release Large-Scale Energy Storage Projects

At the end of 2017, Tesla launched its 100MW/129MWh Li-ion battery project in Southern Australia. Following the launch of this system, many other countries followed with their own large-scale energy storage systems, with many in the 100MW and above range (see chart below).  Energy storage is being recognized by increasing numbers of countries as a reliable and flexible source of energy.

Chart: Representative Examples of Large-Scale Energy Storage Projects

 Source: CNESA Data Collection

Source: CNESA Data Collection

Domestic Grid-Side Storage Projects See Large-Scale Development

In the first half of 2018, Jiangsu and Henan provinces led the way in large-scale grid-side energy storage projects. Both provinces launched similar projects consisting of a total of over 100MW of distributed energy storage stations deployed near a series of substations.  Project investors included State Grid subsidiaries such as Xuji Group, Shandong Electrical Engineering, Jiangsu Energy Services Co, and Pinggao Group, as well as battery manufacturers ZTT, eTrust, CLOU, Lishen, and Narada, and additional PCS and BMS suppliers.  Though development on the projects has been vigorous and reactions have been positive, questions such as whether the business model will be replicable and what kind of investment returns can be expected will depend on whether the industry will continue to develop at a large scale.

The Question of Safety

The fire at South Korea’s South Jeolla wind farm battery storage system once again brought attention to the energy storage system safety.  Unstandardized installation and use of battery systems can have disastrous consequences, yet current standards are still incomplete and/or flawed, in dire need of update and clarification.  Despite these issues, we cannot deny the value of energy storage applications.  The energy storage industry must grapple with the challenge of how to clarify storage standards without hindering the development of the industry, a question that is worthy of further discussion and exploration amongst industry leaders.

Major Energy Companies Update Storage Business Models

Many traditional energy companies have begun turning their business activities towards renewable energy in response to global energy trends.  For some companies, this means establishing new renewable energy operations, while for others it means the acquisition of smaller renewable energy companies.  Many traditional energy companies have also looked for outstanding renewable energy companies for business collaboration, making use of each other’s advantages for mutual benefit.  Some energy storage companies have begun reforming their business practices to better fit market needs, striving to become more economical and effective and make better use of their advantages.  For example, S&C has discontinued manufacture of PCS, instead choosing to focus on microgrid and grid-scale energy storage system aggregation.  Mercedes-Benz has discontinued manufacture of its residential storage batteries, focusing instead on grid-scale energy storage applications.  Finally, Younicos has introduce its “storage-as-a-service” model to meet the immediate energy storage needs of customers.

National and Regional Support in Response to the Guiding Opinions

Following the October 2017 release of the Guiding Opinions on Promoting Energy Storage Technology and Development a number of new policy efforts have appeared at both the national and regional levels that support the goals of the Guiding Opinions.  These include such policies as the Bijie City Energy Storage Industry Development Plan (Draft), Regulations for Operations and Ancillary Services Management of Grid-Connected Energy Storage Stations in Southern Regions, North China Ancillary Services Market Establishment Plan (Draft), standards for lead-carbon batteries and Li-ion batteries used in energy storage systems, and many other recent policy measures that have helped to stimulate the domestic energy storage market.

Author: Ning Na
Translation: George Dudley