China Power Union: the installed energy storage capacity is 6.27GW, and the equivalent utilization c

On November 8, the China Electricity Council 2022 Annual meeting and temporary member Congress was held in Haikou, China. At the meeting, China Electricity Union released a research report on the operation of new energy distribution and storage (hereinafter referred to as the Report).

The report makes a detailed analysis of the application and configuration of energy storage in different scenarios in China, describes the problems faced by new energy distribution and storage, and puts forward relevant suggestions for improvement. The key messages of the report are as follows.

The total energy storage planning scale of the provinces has been more than twice the scale of the 14th Five-Year Plan

According to the report, by the end of 2021, the installed capacity of energy storage in China had reached 42.66 million kW, of which the installed capacity of new energy storage was 6.268 million kW, up 56.4% year on year. 90% of the new energy storage is electrochemical energy storage.

By the end of 2021, the installed energy storage capacity at the power supply side, the user side and the grid side accounted for 49.7%, 27.4% and 22.9% respectively, and the energy storage capacity at the power supply side was nearly half of the installed capacity.

Together, the provinces have planned more than 60 gigawatts of new energy storage development, double the 30 gigawatts target set out in the National Energy Administration's "Guidelines on Accelerating the Development of New energy storage" document by 2025.

Power side distribution of energy storage is the key support direction of each province, focusing on the research of new energy distribution and storage projects

Up to now, nearly 30 provinces in China have issued new energy storage plans or new energy configuration energy storage documents for the 14th Five-Year Plan to vigorously develop "new energy + energy storage".

China Electric Union investigated 208 electrochemical energy storage projects, with a total capacity of 2.15 million kW, accounting for nearly 40% of the installed electrochemical energy storage capacity in China. Among them, the installed capacity of new energy distribution and storage is 1.05 million kW, accounting for two-thirds of the installed capacity of new energy distribution and storage in China, which is representative. The survey results show that:

The configuration time of energy storage projects in different application scenarios

The average storage time of the research unit is 2h, the storage time of new energy configuration is 1.6h, the storage time of thermal power plant allocation is 0.6h, the storage time of power grid is 2.3h, and the storage time of users is 5.3h, basically reflecting the technical requirements and characteristics of each application scenario.

From the distribution of energy storage application scenarios in each region

In North China and Northwest China, new energy distribution storage is the main application; in East China, new energy distribution storage, grid side storage and user side storage are more evenly distributed; in southern China, thermal power plant distribution storage is the main application.

From the energy storage operation strategy

During the period of distribution and storage of new energy at most, one charge and one discharge run every day. In some projects, only part of the energy storage units are called or even not called at all.

From the energy storage equivalent utilization coefficient

The average equivalent utilization coefficient of the investigated electrochemical energy storage projects is 12.2%, the distribution and storage coefficient of new energy is only 6.1%, the distribution and storage coefficient of thermal power plants is 15.3%, the energy storage of power grids is 14.8%, and the energy storage of users is 28.3%. Relatively speaking, the equivalent utilization coefficient of new energy distribution and storage in North China and Northwest China is higher than that in other regions.

Energy storage project cost and business model

Most energy storage projects cost between 1500 and 3000 yuan /kWh, and the cost varies greatly between projects due to different boundary conditions. New energy configuration energy storage has a smooth new energy output power fluctuation, promotion of new energy given quantity reduce power generation plan deviation, improve the safe operation of the power grid stability, alleviate transmission congestion, and so on, in the energy market, ancillary services market, market capacity has multiple values, different business model, regional difference is bigger. But in reality, most energy storage projects are not very profitable.

Problems exist: low utilization rate of new energy distribution and storage, lack of scientific demonstration of distribution and storage scale, lack of cost channelling mechanism, lack of business model, etc

There are still many problems in new energy distribution and storage, mainly reflected in the following aspects:

New energy distribution energy storage utilization rate is low

The call frequency, equivalent utilization coefficient and utilization rate of new energy distribution energy storage are lower than those of thermal power plant distribution energy storage, power grid energy storage and user energy storage.

The scale and type of new energy distribution and storage have not been scientifically demonstrated

There are many kinds of new energy storage, different functions, technical maturity and economic differences. Many places adopt a "one-size-fits-all" configuration standard, and some places take energy storage distribution as a prerequisite for new energy construction. Wind power distribution storage and photovoltaic distribution storage have obvious differences in the utilization of energy storage and the solution of wind and light abandonment, and the homogeneous configuration energy storage requirements are not scientific. Decentralized configuration cannot reflect economies of scale, high operating costs and low efficiency are common problems, and it is difficult to give full play to the role of energy storage.

The cost of new energy storage is high and there is a lack of channeling channels

The cost of new energy storage is higher than that of flexible modification of thermal power and pumped storage. At present, the investment cost of new energy distribution and storage is mainly absorbed by new energy enterprises, and the rising cost of lithium-ion batteries has brought great operating pressure to new energy enterprises.

The new energy storage business model and electricity price mechanism need to be further improved

The benefits of new energy distribution energy storage mainly come from electric energy conversion and auxiliary services. Many market and price rules of energy storage are still to be implemented. The energy storage business model is not stable, the return mechanism is not clear, and the policy changes have a great impact on the revenue. For example, recently, the capacity compensation standard of energy storage in Shandong has dropped significantly, which has a great impact on corporate earnings and is not conducive to investment decisions.

New energy storage safety management still needs to be strengthened

The fire accidents of energy storage both at home and abroad show that safety is the key factor affecting the healthy and stable development of large-scale new energy storage. Under the pressure of high cost, some projects choose energy storage products with poor performance and low investment cost, which increases security risks. According to statistics, from January to August 2022, the number of unplanned shutdowns of electrochemical energy storage projects in China reached 329 times. Safety standards and management norms of electrochemical energy storage need to be further improved.

New energy storage is difficult to operate and maintain

The number of electrochemical cells is huge, and the number of individual batteries in energy storage projects has reached 10,000 or even hundreds of thousands, which is extremely difficult to maintain. The operation and maintenance of the energy storage power station involves many majors, such as electrical, chemical and control. The current operation and maintenance is extensive, and the professionalism of the operation, inspection and maintenance personnel needs to be improved.

Optimize the configuration and operation, improve the safety level, improve the market mechanism, and promote the development of energy storage

According to the actual results of the survey, the report puts forward suggestions for promoting the development of energy storage:

We will optimize the configuration and distribution of energy storage and raise the level of energy storage utilization

The scale and type of energy storage should be configured according to local conditions. Combined with the local new energy given, resource characteristic, space truss structure, load characteristic, the structure of the network safety, power factors, such as specific analysis around the system frequency modulation, the load demand, integrated coal flexibility modification, pumped storage construction, regulate the grid capacity, such as the actual situation, reasonable new energy configuration scale and type of energy storage, avoid the waste of resources. Gradually expand the ratio of independent energy storage to shared energy storage. Overall planning for regional new energy projects and power grid safety operation requirements, centralized construction of independent or shared energy storage power stations, large new energy base projects, new energy distributed projects should be configured with energy storage power stations, new energy projects share energy storage capacity, energy storage costs. We will improve the operation mechanism of energy storage facilities. Establish a coordinated operation mechanism of "unified scheduling and shared use", optimize the grid-connected operation control strategy of energy storage power stations, and improve energy storage utilization efficiency.

Increase scientific and technological innovation and operation and maintenance management to improve energy storage safety

Step up technological innovation. Improve the safety control technology and safety structure of energy storage cell, improve the grid-connected operation control strategy of energy storage power station, and improve the essential safety level; Strengthen the intelligent construction of safety prevention, build digital energy storage power station data processing and operation and maintenance platform, reduce the safety problems caused by control errors. Optimize the safety management system. Strengthen the fire control management of electrochemical energy storage, and formulate the fire control audit, acceptance and record procedures for energy storage power stations; Establish battery selection and testing system. New energy storage projects shall carry out incoming spot inspection of battery monomer, battery module and battery management system as well as grid-connected inspection of energy storage power stations. Those that fail to meet the test requirements shall not be grid-connected. In transportation and energy storage projects, it is necessary to carry out online operation performance monitoring and evaluation, regular spot check and supervision inspection; Strengthen safety training for operation and maintenance personnel. Improve the system of technical standards. To enhance the coupling of energy storage standards with technological innovation and management innovation, speed up the revision of standards in the aspects of energy storage power station design, equipment technical requirements, construction and acceptance, operation and maintenance, equipment overhaul, safety and risk prevention and control, and achieve standard guidance.

Improve the market mechanism and promote the development of the energy storage industry

We will improve the participation of new energy storage power stations in the electricity market. In accordance with the requirements of the Notice on Further Promoting the Participation of New Energy Storage in the Electricity Market and Dispatching and Utilization, local governments have accelerated the improvement of supporting policies and implementation rules related to the participation of energy storage stations in the electricity market, so as to ensure that new energy storage stations can better integrate into the electricity market. We will improve mechanisms for new types of energy storage to participate in the electric energy market and assist in the service market. Market players are encouraged to allocate energy storage resources spontaneously through price signals, and social capital is guided to participate in the construction of new energy storage. We will introduce a new pricing policy for energy storage capacity. We will rationalize the pricing mechanisms for various types of flexible power sources, introduce capacity pricing policies, improve new energy storage business models as soon as possible, and promote reasonable competition for flexible resources such as new energy storage, flexible coal power, and pumped storage.

Source: Energy Storage and Electricity Markets