Analysts: China’s Energy Storage Market to “Skyrocket” by 2024

By Angel Hang for GTM

China is set to become the leading energy storage market in the Asia-Pacific region by 2024. That’s according to new research from Wood Mackenzie Power & Renewables.

China’s cumulative energy storage capacity is projected to skyrocket from 489 megawatts or 843 megawatt-hours in 2017 to 12.5 gigawatts or 32.1 gigawatt-hours in 2024. This represents a 25-fold increase in the installed base.

Policy incentives have been the main drivers behind China’s rapid growth in storage deployments in 2018, already pushing China to become the second-largest market behind South Korea in terms of annual deployments. The market deployed 580 megawatts (1.14 gigawatt-hours), reaching a cumulative market size of 1.07 gigawatts (1.98 gigawatt-hours) last year. Front-of-the-meter (FTM) storage led growth, up fivefold in terms of installed power capacity compared to 2017.

State Grid Corporation of China, a state-owned utility, has deployed 452 megawatt-hours of grid-connected FTM pilot projects, which accounted for 83 percent of FTM market growth nationwide last year. These pilot projects were supported by government research grants.

“Based on current project economics and without policy support, utilities have limited incentive to scale-up investment in FTM storage as part of grid infrastructure,” said Dr. Le Xu, senior analyst at Wood Mackenzie.

This is set to change next year. According to China’s National Energy Administration, the ancillary services market will be transitioning from a basic compensation mechanism to a market integrated with spot energy prices by 2020. That, along with maturity in technology and subsequent cost reductions, are key factors that will contribute to the exponential growth in the nation’s energy storage market through to 2024.

Of storage projects deployed to participate in ancillary services in 2018, 60 percent were deployed as standalone, 14 percent paired with coal plants, and 19 percent were renewables-plus-storage. Utilities led the renewable-plus-storage market growth, deploying 105 megawatt-hours of storage — either paired with solar projects or hybrid solar and wind plants — in Qinghai province to reduce curtailments. There is no business case for solar developers to invest in utility solar-plus-storage, as solar subsidies are being phased out.

“Although China’s energy storage market is still in its infancy, we can expect to see continued strong growth driven by battery cost reduction, policy incentives and power market reform,” said Dr. Xu.

According to Wood Mackenzie, by 2024, global cumulative CapEx investment in the energy storage sector could grow to $71 billion. Of that, China will account for about 14 percent, or just over $10 billion.

 The information contained in this article and provided by VanadiumCorp is sourced from third-party content in the public domain and is for general information purposes only, with no representation, guarantees of completeness, warranty of any kind, express or implied regarding the accuracy, adequacy, validity, availability, completeness, usefulness or timeliness of any information contained within. Please also excuse any syntax as authors and reposted articles are sourced from global origins. UNDER NO CIRCUMSTANCE SHALL WE HAVE LIABILITY TO YOU FOR ANY LOSS OR DAMAGE OF ANY KIND INCURRED AS A RESULT OF THE USE OF THIS REPOSTED ARTICLE. THE USE OF THIS ARTICLE AND YOUR RELIANCE ON ANY INFORMATION CONTAINED HEREIN IS SOLELY AT YOUR OWN RISK. VANADIUMCORP ALSO ASSUMES NO RESPONSIBILITY OR LIABILITY FOR ANY ERRORS OR OMISSIONS IN THE CONTENT OF THIS ARTICLE.

Continue reading the full story here >>
 

This Post Has 0 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *