Accelerating the planning and construction of a new energy system is an important condition and foundation for promoting Chinese path to modernization. The development of new energy storage is a crucial component and key support for China to accelerate the construction of a new energy system. It is of great significance for solving the challenges of power supply security and system balance, promoting the green and low-carbon transformation of energy, and accelerating the cultivation of new productive forces.

Looking ahead, the development potential of new energy storage is enormous. The global demand for new energy storage will continue to grow, and China has a vast export space. With the continuous release of domestic policy dividends, the installed capacity of new energy storage will still maintain rapid growth. The future development prospects of large-scale energy storage and industrial and commercial energy storage are promising. Long-duration new energy storage technologies will become the dominant force, and fields such as compressed air energy storage, flow batteries, and hydrogen energy storage have broad development prospects.

In the coming period, especially during the 15th Five-Year Plan period, we should take new energy storage as a starting point to accelerate the planning and construction of a new energy system: strengthen the traction of major reforms and accelerate the improvement of the market mechanism for new energy storage; strengthen major projects to drive technological research and development, pilot demonstrations, and accelerate the commercialization process; strengthen the leading role of standards and promote the healthy and safe development of new energy storage; strengthen international cooperation and create a "new Chinese business card" for new energy storage.

Both the report of the 20th National Congress of the Communist Party of China and the decision of the Third Plenary Session of the 20th Central Committee emphasize "accelerating the planning and construction of a new energy system." Currently, the new energy storage industry is experiencing explosive growth, the global market penetration rate of enterprises is accelerating, the policy support system is constantly improving, providing a favorable environment for industrial development, the installed capacity of new energy storage is expanding rapidly, and its regulatory role is gradually emerging. The technological routes of new energy storage are diverse, and research and development in some fields are leading the world.

Looking ahead, the development potential of new energy storage is huge. In the coming period, especially during the 15th Five-Year Plan period, we should actively seize the development opportunities of new energy storage. While making good use of existing policies, we should further strengthen top-level design, strengthen the traction of major reforms, accelerate the improvement of the market mechanism for new energy storage, and continuously promote the high-quality development of the new energy storage industry to help build a new energy system.

I. New Energy Storage is a Key Starting Point for Accelerating the Planning and Construction of a New Energy System

Accelerating the planning and construction of a new energy system is an important condition and foundation for promoting Chinese path to modernization. The development of new energy storage is an important part and key support for China to accelerate the construction of a new energy system, and it is of great significance for solving the problems of power supply security and system balance, promoting the green and low-carbon transformation of energy, and accelerating the cultivation of new productive forces.

(1) The pressure on power supply security and system balance is increasing day by day, and there is an urgent need to develop new energy storage to ensure the safe and stable operation of the new power system

In recent years, the intermittency and volatility of new energy sources such as wind energy and solar energy have had a more and more obvious impact on the safety of the power grid. Due to the large-scale grid connection of photovoltaic power generation, the load of many provincial power grids shows a "duck curve" during the noon period. This is because the photovoltaic power generation is the largest at noon, but the power demand surges sharply in the evening, and the gap between the peak load and the renewable energy power generation during the day takes on the outline of a duck. Data shows that the highest electricity consumption load in the country reached 1.34 billion kilowatts, and the maximum daily power fluctuation of new energy exceeded 300 million kilowatts, accounting for 22% of the maximum load. It is estimated that by 2060, the maximum daily power fluctuation of new energy will reach 1.6 billion kilowatts, accounting for 40% of the maximum load. In addition, the impact of climate change factors and extreme weather on the planning, production, and operation of the power system has intensified, and the problems of power supply security and system balance will become more prominent. Therefore, the construction of a new power system cannot be separated from the strong support of new energy storage.

(2) New energy storage is the core force for promoting the green transformation of energy, and the development of new energy storage is conducive to better supporting the realization of the "dual carbon" goal

The green transformation of energy is a key link in promoting the realization of the "dual carbon" goal. Among them, as an important basic equipment and key support technology for constructing a new power system and a new energy system and ensuring national energy security, new energy storage is the core force for promoting the green transformation of energy. Firstly, as the "ballast stone" of the new power system, new energy storage can effectively ensure the safe and stable operation of the power system. Secondly, through reducing the consumption of fossil energy and increasing the utilization rate of renewable energy, new energy storage technologies can significantly reduce the carbon emission intensity. Finally, the new energy storage industry chain is long, has strong driving force, and has obvious green and low-carbon attributes, making it an important force for promoting the transformation of the energy structure. Therefore, the development of new energy storage is of great significance for promoting the green transformation of energy and occupies an important position in the overall situation of national green development.

(3) New energy storage is a typical representative of new productive forces, and the development of new energy storage is conducive to seizing new international strategic heights

New energy storage includes technical routes such as lithium-ion batteries, flow batteries, compressed air energy storage, and flywheel energy storage. It not only improves the energy conversion efficiency but also has the characteristics of high efficiency, reliability, environmental friendliness, and flexibility, which are in line with the characteristics of new productive forces. New energy storage has high economic added value and a long equipment industry chain, and it is a future business form that gives birth to a new industrial pattern. New energy storage has become an important field for countries around the world to seize new heights in energy strategies and the equipment manufacturing industry. Therefore, accelerating the development of new energy storage is conducive to giving birth to new energy business forms, creating new productive forces, and seizing development opportunities in the global market.

II. China's New Energy Storage Has Advantages Leading the World

China's policy support system for new energy storage is constantly improving, providing a favorable environment for industrial development. Currently, the new energy storage industry is experiencing explosive growth, the global market penetration rate of Chinese enterprises is accelerating, and research and development in some technical fields of new energy storage are leading the world.

(1) The policy support system is constantly improving, providing a favorable environment for industrial development

At the national level, a systematic deployment of new energy storage has been made to assist in the construction of a new power system. On the one hand, we should accelerate the improvement of the top-level design of new energy storage. In 2021, the "Guiding Opinions on Accelerating the Development of New Energy Storage" jointly issued by the National Development and Reform Commission and the National Energy Administration required that by 2025, new energy storage should transform from the initial commercialization stage to large-scale development, with an installed capacity of more than 30 million kilowatts; by 2030, new energy storage should achieve full market-oriented development, and the installed capacity should basically meet the corresponding needs of the new power system. In 2022, the "Implementation Plan for the Development of New Energy Storage during the 14th Five-Year Plan Period" jointly issued by the National Development and Reform Commission and the National Energy Administration proposed to actively create a good situation of multi-round driving by technology, market, and policy, and promote the high-quality and large-scale development of new energy storage with the idea of making progress while maintaining stability, providing strong support for accelerating the construction of a clean, low-carbon, safe, and efficient energy system. On the other hand, we should focus on the fields of new energy storage participating in grid peak regulation, grid connection and dispatching, and new energy consumption. In February 2024, the National Development and Reform Commission and the National Energy Administration jointly issued the "Guiding Opinions on Strengthening the Construction of Grid Peak Regulation Energy Storage and Intelligent Dispatching Capabilities", for the first time listing energy storage alongside grid peak regulation and intelligent dispatching as a key support for promoting the large-scale and high-proportion development of new energy and an important part of constructing a new power system. In April 2024, the National Energy Administration issued the "Notice on Promoting the Grid Connection and Dispatching Application of New Energy Storage", clarifying the functional positioning of new energy storage. In May 2024, the "Notice on Doing a Good Job in the Consumption of New Energy and Ensuring the High-Quality Development of New Energy" issued by the National Energy Administration proposed to carry out the evaluation and identification of the regulation performance of various energy storage facilities, put forward management requirements, and ensure the regulation effect.

At the local level, attention is paid to improving the grid connection services of new energy storage, and the market-oriented method is used to promote the deployment of new energy storage. Jiangxi proposed that by 2025 and 2030, the scale of new energy storage put into operation in each prefecture-level city should strive to be no less than 15% and 20% of the newly added new energy installed capacity respectively. Zhejiang proposed to establish a reward and subsidy mechanism for grid-side energy storage demonstration projects, issue management measures for new energy storage and construction guidelines for user-side energy storage, and add 1.5 million kilowatts of new energy storage. Shaanxi proposed that by 2025, the total scale of new energy storage connected to the grid should strive to reach more than 2GW. Shandong encourages new energy power stations and the energy storage built with them to participate in the electricity market transaction with the full power, and forces new energy enterprises to improve the utilization rate of the built energy storage through the market-oriented method.

(2) The new energy storage industry is experiencing explosive growth, and the initial results of brand going global are emerging

The new energy storage industry is developing rapidly. In recent years, China's new energy storage industry has shown explosive growth, and China has become the world's largest energy storage market and the provider of energy storage products. By the end of 2023, more than 100,000 enterprises had entered the new energy storage industry track, and tens of thousands of new energy storage enterprises were added within a year. At the same time, the new energy storage industry in local areas is developing rapidly. Taking Ningxiang, a prefecture-level city in Hunan Province, as an example, the advanced energy storage materials industry in this city is rising rapidly. The output value has grown from 16 billion yuan in 2020 to 60 billion yuan so far, and it is expected to exceed 100 billion yuan in 2025.

New energy storage enterprises and products are accelerating their entry into the international market, and the global market penetration rate is accelerating. Benefiting from the product and cost advantages brought by innovation-driven development, China's energy storage products are accelerating their export. Data from the Ministry of Industry and Information Technology shows that from January to June 2024, the output of energy storage lithium batteries exceeded 110GWh, and the total export value of lithium batteries in the country reached 193.4 billion yuan. Data from Gangtise Investment Research shows that in July 2024, the export of energy storage batteries was 6GWh, a year-on-year increase of 470%; from January to July 2024, the export of energy storage batteries was 19.6GWh, a year-on-year increase of 154%. The global market penetration rate of Chinese enterprises in the energy storage market has been further improved. In 2023, the market share of CATL's global energy storage battery shipments reached 40%, ranking first in the world for three consecutive years. From 2018 to 2023, CATL's revenue from the energy storage segment increased sharply from 189 million yuan to nearly 60 billion yuan.

(3) The installed capacity of new energy storage is expanding rapidly, and the regulatory role is gradually emerging

The installed capacity is growing steadily, continuously achieving new breakthroughs. Data from the National Energy Administration shows that by the end of 2023, the cumulative installed capacity of new energy storage projects put into operation nationwide reached 31.39 million kilowatts/66.88 million kilowatt-hours, with an average energy storage duration of 2.1 hours, nearly 10 times the installed capacity at the end of the 13th Five-Year Plan period. The installed capacity of new energy storage completed the planned target two years ahead of schedule. By the end of the first half of 2024, the cumulative installed capacity of new energy storage projects completed and put into operation nationwide reached 44.44 million kilowatts/99.06 million kilowatt-hours, an increase of more than 40% compared with the end of 2023.

The level of dispatching and application of new energy storage continues to improve, and the regulatory role is constantly enhanced. According to the statistical data of power grid enterprises, in the first half of 2024, the equivalent utilization hours of new energy storage in the operation area of the State Grid Corporation reached 390 hours, and the equivalent charge-discharge times were about 93 times, an increase of about 100% and 86% respectively compared with the first half of 2023. Through research, the National Energy Administration found that as the installed capacity of new energy storage gradually increases, the role of new energy storage in promoting the development and consumption of new energy and improving the safety and stable operation level of the power system is gradually enhanced, effectively serving energy security. For example, as of July 15th, the installed capacity of new energy storage completed and put into operation in Jiangsu Province reached 5.4 million kilowatts, providing important support for the peak summer period.

(4) The technological routes of new energy storage are diverse, and the application scenarios are becoming more and more extensive

The diversified development trend of new energy storage technologies is obvious, and research and development in some fields are leading the world. Data from the National Energy Administration shows that by the first half of 2024, the proportion of lithium-ion battery energy storage put into operation was 97.0%, the proportion of compressed air energy storage was 1.1%, the proportion of lead-carbon (acid) battery energy storage was 0.8%, the proportion of flow battery energy storage was 0.4%, and the proportion of other technical routes was 0.7%. In addition, China's research and development in some fields of new energy storage are at the forefront of the market. Data from the National Intellectual Property Administration shows that in the field of lithium batteries, especially solid-state batteries, China is one of the main global sources of technology. In the past five years, the annual average growth rate of China's global patent applications for solid-state batteries has been 20.8%, ranking first in the world in terms of growth rate. Data from the National Energy Administration shows that China's patent quantity for hydrogen energy ranks first in the world, and key core technologies are being broken through at an accelerated pace. In addition, breakthroughs have been achieved in 300-megawatt-class compressed air energy storage main equipment, fully domesticized flow battery diaphragms, and single-unit megawatt-level flywheel energy storage systems, helping China's energy storage technology reach the world's advanced level.

The application scenarios are becoming more and more extensive, and the energy storage of industrial and commercial users is developing rapidly. In addition to supporting the construction of a new power system and improving the safety and stable operation level of the system, new energy storage also effectively serves users and improves energy utilization efficiency. Data from the National Energy Administration shows that by the first half of 2024, the proportion of installed capacity of independent energy storage and shared energy storage was 45.3%, the proportion of installed capacity of energy storage configured with new energy was 42.8%, and the proportion of other application scenarios was 11.9%. Among them, the energy storage of industrial and commercial users in Guangdong, Zhejiang and other places is developing rapidly.

(5) The proportion of installed capacity put into operation in the Northwest and North China exceeds half, and East China has an obvious advantage in the production capacity of energy storage batteries

The regional characteristics of the installed capacity distribution of new energy storage are obvious, mainly concentrated in the Northwest, North China and other places. The Northwest region of China is rich in wind and solar resources and has become the region with the fastest installed capacity of new energy storage put into operation in the country. Data from the National Energy Administration shows that by the first half of 2024, the combined proportion of the installed capacity of new energy storage put into operation in the Northwest and North China regions accounted for more than 50% of the country, 27.3% and 27.2% respectively. The Central China region accounted for 15.3%, the South region accounted for 15.2%, and the East China region accounted for 14.6%.

The production capacity of lithium batteries is mainly distributed in East China. Currently, the regional distribution of the lithium battery industry chain presents a pattern with East China as the leading region and other regions developing in coordination. East China has obvious advantages in both the layout of power batteries and energy storage batteries. The "White Paper on the Development of China's Energy Storage (Including Power Batteries) Industrial Clusters" released by Cushman & Wakefield and the Energy Storage Branch of the China Battery Industry Association shows that currently, the planned production capacity of power and energy storage batteries in the East China region exceeds 2300GWh, accounting for nearly 50% of the national production capacity; the Central China and Northwest regions are 850GWh and 860GWh respectively; the South China region is about 380GWh; and overseas is about 330GWh. Among them, the production capacity of pure energy storage batteries is mainly distributed in East China and Southwest China.

China's lithium battery industry has obvious gradient-based professional division of labor. The lithium battery industry chain in the eastern region is relatively complete, and it leads the country in technological innovation fields such as lithium battery research and development. The central and western regions have advantages in the upstream raw material mining and processing links, and have also formed a certain foundation in the lithium battery manufacturing link. The lithium battery industry chain has gradually formed.