China has released a slew of policies to turbocharge the energy storage industry, which insiders believe will bring huge opportunities to enterprises in the country.
Power generation firms are encouraged to build energy storage facilities and improve their capability to shift peak loads, according to a notice co-released by the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA).
Hua Yin Technology, one of the pioneering companies in China's flow battery industry, detected an opportunity soon after the policy was unveiled.
"In recent years, the power storing business has become the main engine driving the company's revenue growth," said Fu Hongtao, vice president of the firm based in northwest China's Shaanxi Province.
Dedicated to the vanadium industrial chain, Hua Yin Technology entered the vanadium flow battery market in 2016, and the company's electrolyte production line now has an output value of 1.6 billion yuan (about 247 million U.S. dollars).
Fu said the industry is set to make further progress as an increasing proportion of clean power sources are used across China.
Data shows that China has seen leapfrog growth in its new energy generation capacity, as the newly added installed volume hit 119.87 million kilowatts in 2020, accounting for 63 percent of the nationwide total.
But the steady growth of installed capacity has put a strain on the country's power system due to insufficient regulation capabilities.
"Renewable energy sources including solar and wind are intermittent and volatile," said He Gang, a professor at the Xi'an Jiaotong University (XJTU), noting that the grid will see mounting pressure as electricity is used in a continuous manner.
To realize the transition to a new type of power system with new energy as the main body, He underscored that new types of power storage will play an increasingly important role.
New types of energy storage technologies are, with the exception of pumped storage, those that have power as their main output form. In late July, the NDRC and the NEA released a plan for the blueprint of the industry.
According to the plan, the country's total installed capacity for new types of power storing is expected to surpass 30 million kilowatts in 2025, about 10 times its present level.
"It is the first time that China has set a national installed capacity goal in the sector," said NEA official Liu Yafang, adding that the policy is not just about scale but puts forward other requirements including technology and industry standards to realize high-quality development.
Listed companies maintained their growth momentum in the first half of 2021. Power solution provider Kehua Data Co., Ltd. predicts its net profit attributable to shareholders will rise 65 percent to 100 percent year on year.
The industry's improvements are mainly attributable to battery technology breakthroughs, said Yu Zhenhua, head of the China Energy Storage Alliance, adding that lithium batteries led the increase in newly added installed capacity, while non-lithium technologies such as flow batteries are also accelerating their pace of evolution.
Noting that all technologies have their own advantages and suitable application scenarios at the moment, He said no single technology could dominate the market now and the competition of diverse technologies will continue.
To promote the industrialization of energy storage technologies, Hua Yin Technology and XJTU in April this year inked a strategic cooperation agreement to establish a flow cell innovation center.
"This is a great development opportunity for us," Fu said, adding that the firm will partner further with the university in tech research and tap into the potential of the power storage industry.
