Overview of Energy Storage Industry Chain Pattern (2022 edition)

In the context of clean, low-carbon and intelligent energy transformation, a high proportion of renewable energy has become the "main force" for the future development of the power system. The structure of the power system is changing dramatically.

Energy storage will become the "standard configuration" to maintain the safety and stability of the whole power system.

At present, the energy storage industry is accelerating the transition from the demonstration and pilot stage to the commercialization stage, the market is booming, and the construction of new capacity is accelerating.

The International Energy Network/Energy Storage Headlines presents the panorama of energy storage industry chain (2022 edition) for readers.

The energy storage industry chain can be divided into upstream raw materials and equipment, midstream energy storage systems and integration, and downstream power system energy storage applications.

The upstream raw materials of energy storage industry chain mainly include positive material, negative material, electrolyte, diaphragm and structural parts, etc. Representative enterprises: Shanshan Stock, Rongbai Technology, Dangsheng Technology, Zhongke Electric, etc.

The midstream of the industrial chain is mainly the integration and manufacturing of energy storage systems, which generally includes four major components: battery pack, battery management system (BMS), energy management system (EMS) and energy storage converter (PCS). Representative enterprises include Ningde Times, Yiwei Lithium Energy, Sunshine Power Supply, Nandu Power Supply, Costar and so on, among which the leading companies Ningde Times, BYD, Sunshine Power Supply and so on are exported overseas.

The downstream of the industrial chain is mainly engineering EPC, grid-connected testing, and late operation and maintenance: representative enterprises include Nanwang Technology, Baoguang Stock, Wanliyang, Institute of Electrical Science and Technology, Linyang Energy, etc.

(1) Energy storage industry chain part represents the company

(2) Market sales data of energy storage enterprises in 2021

1. China's energy storage technology Provider's Domestic newly installed Capacity in 2021 (MWh)

2. China's energy storage PCS Provider's newly installed domestic units in 2021 (MW)

3. China's energy storage System Integrators' newly installed domestic capacity in 2021 (MW)

4. China Energy Storage System Integrator's Shipments of Energy storage systems in the domestic market in 2021 (MWh)

Batteries and battery technology

The energy storage battery material system is mainly lithium iron phosphate, and the battery continues to evolve in the direction of large capacity.

According to the requirements of the Ministry of Industry and Information Technology, the energy density of the energy storage battery is not less than 145Wh/kg, and the energy density of the battery pack is not less than 110Wh/kg. Cycle life ≥5000 times and capacity retention rate ≥80%.

* Global Energy Storage Battery Shipment Distribution (GWh), 2022-2023

* Distribution of global energy storage cell shipments in 2021

In the world of energy storage cells, Chinese manufacturers lead the shipment, Ningde times the world's largest shipment. According to estimates, the global energy storage cell shipment in 2021 is 59.9GWh, among which Ningde Times, as the largest cell supplier, occupies the first place, with a shipment of 16.7GWh, accounting for 27.9%. Peineng Technology, as the household storage leader, shipped 1.5GWh, accounting for 2.6%. We estimate that the global shipment in 2022 will be 114.9GWh, up by 91.9%, among which the shipment of Ningde Times will be 45.0GWh, up by 169.5%; Peineng Technology shipped 3.5GWh, up by 127.3%.

According to the calculation, the global energy storage cell shipment is expected to be 122.5/219.6GWh from 2022 to 2023, with an increase of 101%/79%. Among them, Ningde Times occupies the top spot as the largest cell supplier. It is expected to ship 50/100GWh in 2022-2023, with the same increase of 199%/100%, accounting for 40.8%/45.5%, and its leading position is stable.

* Energy storage battery technology trends

Lithium energy storage technology has entered a "new revolution". New products and technologies such as large cell, high voltage, water cooling/liquid cooling have gradually attracted attention, and the energy storage system continues to stride towards the direction of large capacity. Meanwhile, sodium-ion batteries may play a role in the future because of their cost advantages.

Energy storage converter

Energy storage converter (PCS) is a bidirectional current controllable conversion device connecting the energy storage battery system and the power grid. It can accurately and quickly adjust the voltage, frequency and power between the power grid and the energy storage system to achieve constant power constant current charge and discharge and smooth fluctuating power output.

Energy storage inverter converts mains AC power into DC power to charge and store batteries (accumulators). When the mains is cut off, the electricity stored in the battery will be converted into the household or industrial three-phase electricity we need.

In contrast, the energy storage converter has the function of switching between DC and AC as an energy storage inverter, as well as the function of controlling charge and discharge. It can be said that the energy storage converter contains the function of the energy storage inverter, which is a more mature application.

Energy storage converter and photovoltaic inverter have the same technology, and the development of PCS is basically similar to that of photovoltaic inverter.

Energy storage converters can be divided into four categories according to different application scenarios: household use, industrial and commercial use, centralized type and energy storage power station, corresponding to small, medium, large and large rated output power respectively.

Energy storage converter cost accounts for 10%-20%, second only to battery pack (60%).

The energy storage converter determines the quality and characteristics of the output power, which greatly affects the life of the battery. PCS is an important component in energy storage system, which consists of hardware and software such as power, control, protection and monitoring. Its main functions include power suppression, information exchange, integration of charge and discharge combined with BMS system, and off-grid operation.

With the development of electrochemical energy storage, energy storage converter market space is considerable. Due to the volatility of photovoltaic, wind power and other new energy generation, coupled with the impact of power rationing policies, enterprises' demand for peak and frequency regulation and the promotion of domestic renewable energy distribution energy storage policy, the future energy storage market will maintain a rapid growth.

Data show that in 2021, the output of energy storage converters increased to 1.947,500 kW. The demand for energy storage converters grew to 1.85 million kW. It is estimated that in 2022, the production and sales volume of energy storage converters are expected to exceed 2 million kW.

Source: Open Source Securities Institute

At present, energy storage converters have higher gross profit margins than photovoltaic inverters. Since the realization principle of energy storage converter products and photovoltaic inverter is the same, they can be produced in the same production line. With the gradual increase of the sales proportion of energy storage converter products, it will help the profit growth of enterprises.

* Core topology and IGBT for energy storage converters.

In terms of topology structure, the topologies applied in different fields are different, especially in high-power energy storage PCS, where various interrelated coupling between the grid-connected systems between the multiple converters constitute a complex high-order electrical network, which is easy to cause the resonance of the grid-connected system. Therefore, the design of topology structure is more important. Domestic manufacturers will provide their own solutions according to different application fields.

In terms of IGBT, compared with photovoltaic inverter, energy storage converter has higher requirement on current carrying capacity of continuous current diode, that is, larger diode chip is needed. At present, the main PCS manufacturers in China mostly use IGBT from overseas head manufacturers (such as Infineon), and also use IGBT provided by domestic manufacturers in small batches (such as Star Semiconductor and Time Electric).

The high-voltage cascading solution with large capacity has obvious advantages. The high-voltage cascade scheme is composed of multiple energy storage units, which are combined in parallel. Each energy storage unit outputs dozens to hundreds of volts, and discretized the battery stack. It not only greatly reduces the battery quantity and the number of single batteries in the battery stack, but also greatly improves the system capacity and improves the system security.

High voltage cascade technology solution vs. traditional low voltage boost solution

Throughout the energy storage converter market, Sunshine Power Supply, Costar, Goodway, Jinlang Technology and other enterprises have layout in energy storage convertors. In particular, in the face of the large rise of the energy storage inverter market, a group of Chinese PV inverter second tier of the main force actively pursue the road to break the game, accelerate to seize the market opportunity. With the further development of the market in the future, enterprises with products, channels and cost advantages will still benefit from the high growth rate of the industry and finally stand out.

Energy storage system integration

ⅰ. Layout of the whole industrial chain: Cell, PCS, BMS and EMS are all self-produced, and the representative enterprise in China is BYD.

ⅱ. Professional integration: integrators purchase components from the outside, specializing in system integration, the domestic application of this mode is less, foreign Doosan, IHI, etc., as the representative;

ⅲ. Transform from a simple equipment supplier to a system integrator based on its own products: this mode is most widely used in China, with representative enterprises as follows: 1. Pv inverter into PCS manufacturers such as Jinlang Technology, Goodway, Deye Technology, etc.; 2. Power battery into energy storage battery manufacturers such as Yiwei Lithium Energy, Penghui Energy, etc.; 3. PCS/BMS/EMS component manufacturers such as Kingpan Technology, Costar, Kehua Data, Baoguang Stock, and Kelu Electronics, etc. are imported from power equipment and electronic equipment.

The participation of major U.S. energy storage integrators in the industrial chain

Data source: Soochow Securities Research Institute

Project and customer resource analysis of major energy storage integrators

By analyzing and comparing the project and customer resources of major energy storage integrators, it can be found that major enterprises have established cooperative relationships with major power grid groups. In addition, HaIBO and Kelu Electronics have greater potential in the industrial and commercial side and the residential side, and may gain profits from the acquisition of shared energy storage and other projects in the long run.

In terms of projects, leading companies such as Sunbeam Power Supply and HaIBO have been experienced in the construction of projects above GWh and have obvious first-mover advantages. At the same time, the up-and-coming Goldpan Technology, Kelu Electronics and other strong order acquisition ability; In addition, the industry demand is strong, and the enterprise has a strong capacity to expand. The existing capacity of Jinpan Technology and Zhiguang Shares is over GWh, which is still in the process of production expansion.

Differentiated competitive landscape of energy storage integration market

New technology for energy storage

1. The commercial process of sodium ion batteries is accelerating

The sodium battery has excellent fast charging performance (charging power can reach 80% in 15min at normal temperature), good low-temperature performance, cycle life of 4k-5k times at normal temperature, and energy density equal to that of lithium iron.

Abundant available resources. In 2022, the proven amount of lithium resources in the world is about 89 million tons, more than half of which are distributed in South America. The total amount of lithium resources in China is 5.1 million tons, accounting for only 6% in the world, and 65% of the lithium raw materials need to be imported. However, the crustal abundance of sodium is much higher than that of lithium and it is widely distributed all over the world. Seawater is rich in sodium chloride.

Compared with lithium iron and Series 5 ternary single watt-hour, the cost of sodium battery is reduced by 45% to 55% respectively, and the commercialization process is accelerated.

Representative manufacturers include NatronEnergy, NAIADES, FARADION, Sodium Innovation Energy, Zhongke Haina, Ningde Times.

2. Liquid flow battery focuses on long-term performance

Electrolyte separation between positive and negative electrodes of liquid flow battery has excellent performance. Iron chromium and all vanadium are the two main commercial directions.

Liquid flow battery is a kind of high performance battery in which the positive and negative electrolytes are separated and circulated respectively. It has the characteristics of high capacity, wide application field (environment) and long cycle life. According to the different electrode active substance, it can be divided into Fe-chromium, all-vanadium, zinc-bromine, etc. Fe-chromium and all-vanadium are the mainstream commercial direction at present.

Long cycle life of iron-chrome battery, wide operating temperature zone, cost reduction is imminent. In 2022, the global chromite resources are about 12 billion tons, of which South Africa occupies half. Our country and the chromium mining countries maintain normal trade cooperation, with a reasonable supply pattern. Iron chromium flow battery has low toxicity and corrosion, the number of theoretical cycles can reach more than 10,000 times, and the overall service life can reach more than 20 years. In terms of cost, the future comprehensive cost may be close to pumped storage.

3. Vanadium batteries have excellent performance and abundant resources, but high cost.

China is rich in vanadium resources. In 2022, the proven vanadium resources in the world are about 63 million tons, and the total amount of vanadium resources in China is 9.5 million tons, accounting for 15% of the global total. In 2020, the vanadium production capacity (converted into V2O5) of China Panzhihua Steel Group ranked the first in the world.

The vanadium battery has high security, a cycle life of up to 16,000 times, and strong capacity expansion. It is suitable for large-scale energy storage scenarios, and the electrolyte is easy to recover, with an efficiency of more than 75%. All-vanadium batteries have high energy density and high cost.

4. Gravity energy storage: Cost dominance in physical energy storage

The main principle is to lift the energy storage medium based on the height difference to realize the charge and discharge process of the energy storage system.

Gravity energy storage advantages:

The initial input cost is only about 3 yuan /Wh, which is lower than the cost of pumped storage and compressed air storage. It is estimated that the kilowatt-hour cost of gravity energy storage is about 0.5 yuan /kWh, which is lower than most electrochemical energy storage systems and has advantages in cost. High safety, not high requirements for the construction environment, little damage to the environment; The average life of gravity energy storage is about 30-35 years, which is close to pumped storage and compressed air energy storage.

China Tianying: The pioneer of gravity energy storage in China, the first gravity energy storage project has been signed. On January 30, 2022, Atlas, a subsidiary of China's Tianying Holdings, signed a "Technology License Agreement" with EV, a Swiss developer of gravity energy storage technology. According to the agreement, EV authorized Atlas to exclusively use the licensed technology to build and operate gravity energy storage system facilities in China. On May 20th, this project settled in the East, which is the first demonstration project of our country with a scale of 26MW/ 100MWh, the signing of the project is expected to accelerate the progress of gravity energy storage industry of our country.

5. Compressed air energy storage technology is mature

Compressed air energy storage refers to the energy storage method that uses the electric energy for compressed air in the off-peak load period of the power grid, seals the air in the scrapped mine, gas storage tank, cave, expired oil and gas well or newly built gas storage well under high pressure, and releases the compressed air to drive the turbine to generate electricity during the peak load period of the power grid. Compared with the construction of steel tanks and other pressure vessel storage methods, the use of salt caverns and other underground caverns to build large-capacity power stations will significantly reduce the cost of raw materials, land and other aspects. According to the working medium, storage medium and heat source, it can be divided into: traditional compressed air energy storage system (need supplementary combustion), compressed air energy storage system with heat storage device, liquid gas compression energy storage system, etc.

Compressed air energy storage classification

Domestic projects have been put into production.

On September 23, 2021, the phase I 10MW demonstration power station of the salt cavitation Advanced Compressed air Energy Storage Peak-balancing Power Station in Feicheng, Shandong Province successfully passed the grid acceptance, and the phase II 300MW project has also started.

On May 26, 2022, the Jintan Salt Caverns Compressed air Energy Storage National pilot demonstration Project was put into operation, marking the world's first non-supplementary combustion compressed air energy storage power station officially put into commercial operation. The pricing mechanism of compressed air energy storage power station is still in the exploration stage. If it can adopt two-part price system like pumped storage power station, its economy will be improved.

6. Flywheel energy storage was in the early days of commercialization

Flywheel energy storage is one of the new energy storage technologies, which is in the early stage of commercialization. The electric energy and the mechanical kinetic energy of the flywheel running at high speed can be converted and stored by the electric/generator reciprocal bidirectional motor. Flywheel energy storage has the advantages of long service life, high energy storage density, not limited by the number of charge and discharge, easy installation and maintenance, little harm to the environment and so on. It can be used for uninterruptable power supply, emergency power supply, power grid peak regulation and frequency control. However, flywheel energy storage still has great limitations, such as low relative energy density and large static loss. It is only in the early stage of commercialization.

The main structure and operation method of flywheel energy storage technology have been defined basically. At present, it is mainly in a wide range of experimental stage, the small prototype has been developed successfully and has been applied to the actual examples, the trend of the development of the mainframe, but there are a lot of difficulties, mainly focused on the rotor design, magnetic bearing, power electronic circuit, safety and protection characteristics, mechanical backup bearing.

Flywheel energy storage system is widely used. With the maturity of technology and the reduction of price, it will be a new revolution in the field of energy storage.

On April 11, 2022, two 1MW flywheel energy storage devices were installed, debugging and connected to the grid successfully at Wanniquan Road Station of Qingdao Metro Line 3, which is the first megawatt flywheel energy storage device with fully independent intellectual property rights in China's rail transit industry.

Energy storage fire system

Lithium metal in lithium-ion battery is the most active metal among known elements (including radioactive elements). The phenomenon of thermal runaway often occurs in the field of automobile, which poses a hidden danger to the application of lithium battery in energy storage.

According to incomplete statistics, there have been more than 17 fire accidents of energy storage in the world in 2022. Since 2021, the country has issued a number of policies related to energy storage fire safety, and the importance of energy storage fire protection under the new standard has been highlighted. The development of energy storage fire fighting system is accelerated.

Fire accidents in energy storage power stations are frequent recently

Major safety related policies for energy storage

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