China Shenzhen First Tech Co., Ltd. Company News

   Advantages of the Inverter Market in the Middle East      The inverter market in the Middle East is experiencing growth due to several distinctive advantages and favorable conditions. Here are the key benefits driving this market:    1. Abundant Solar Resources    High Solar Irradiance: The Middle East enjoys some of the highest levels of solar radiation in the world, making it an ideal region for solar energy generation. Long Sunshine Hours: Extended daylight hours throughout the year enhance the potential for solar power production, increasing the demand for efficient inverters.    2. Government Initiatives and Support    Renewable Energy Targets: Many Middle Eastern countries have set ambitious renewable energy targets, such as Saudi Arabia’s Vision 2030 and the UAE's Energy Strategy 2050, which emphasize solar energy expansion. Incentives and Subsidies: Governments are providing financial incentives, subsidies, and tax breaks to encourage the adoption of solar technologies and associated components, including inverters.    3. Growing Energy Demand    Rising Electricity Consumption: Rapid urbanization and population growth are driving up energy demand in the region, prompting investments in renewable energy solutions to meet this need. Diversification of Energy Sources: Countries are looking to diversify their energy mix, reducing reliance on fossil fuels and enhancing energy security.    4. Technological Advancements    Innovative Inverter Solutions: The market is witnessing advancements in inverter technology, including smart inverters, which enhance energy efficiency, monitoring, and grid stability. Integration with Energy Storage: Hybrid inverters that combine solar energy generation with battery storage are becoming increasingly popular, providing reliable energy solutions.    5. Economic Diversification Efforts    Investment in Renewable Projects: Many Middle Eastern nations are investing in renewable energy projects as part of broader economic diversification strategies, creating a favorable environment for the inverter market. Public-Private Partnerships: Collaborations between governments and private companies are fostering the development of large-scale solar projects, driving demand for inverters.    6. Expanding Market for Distributed Energy    Off-Grid Solutions: The increasing popularity of off-grid solar systems for rural electrification and public facilities is creating new opportunities for inverter manufacturers. Smart Grid Development: Initiatives to develop smart grids are enhancing the role of inverters in managing energy flow, integrating renewable sources, and optimizing energy distribution.    Conclusion    The inverter market in the Middle East is poised for significant growth, supported by abundant solar resources, strong government initiatives, and rising energy demand. As countries in the region transition towards sustainable energy solutions, the role of inverters will be critical in facilitating this shift and ensuring efficient energy management.  

   Inverter Market Overview in Africa      The inverter market in Africa is witnessing significant growth, driven by the increasing demand for renewable energy solutions, particularly solar power. Here’s an overview of the current state and trends in the African inverter market:    1. Market Drivers    Rising Energy Demand: Rapid urbanization and population growth in Africa are leading to an increasing demand for reliable electricity, pushing investments in renewable energy sources. Access to Off-Grid Solutions: Many regions in Africa lack reliable grid access, making solar and hybrid inverter systems appealing for off-grid and rural electrification projects. Government Initiatives: Various African governments are promoting renewable energy through policies, incentives, and regulatory frameworks, encouraging the adoption of solar technology and inverters.    2. Market Segmentation    Residential Sector: Homeowners are increasingly adopting solar energy systems with inverters to reduce electricity costs and improve energy security. Commercial Sector: Small to medium-sized enterprises (SMEs) are investing in solar inverters to manage energy expenses and enhance sustainability. Utility-Scale Projects: Large-scale solar projects are being developed across the continent, requiring significant inverter solutions to manage energy production and distribution.    3. Geographic Trends    East Africa: Countries like Kenya and Tanzania are leading in solar adoption due to favorable solar conditions and supportive government policies. Southern Africa: South Africa is a key market, with significant investments in renewable energy and established policies supporting solar energy deployment. West Africa: Nations like Nigeria and Ghana are increasingly focusing on solar energy solutions to address energy shortages and improve access to electricity.    4. Competitive Landscape    Key Players: The market includes global and local manufacturers such as SMA Solar Technology, Huawei, Schneider Electric, and local firms specializing in off-grid solar solutions. Emerging Startups: Innovative startups are entering the market with affordable solar solutions tailored to local needs, enhancing competition.    5. Challenges    Infrastructure Issues: Poor infrastructure and high costs of solar equipment can hinder market growth in some regions. Financing Barriers: Limited access to financing and investment for renewable energy projects can restrict the deployment of solar inverters.    6. Future Outlook    The African inverter market is expected to continue growing, driven by increasing investments in renewable energy, technological advancements, and supportive government policies. As more consumers and businesses recognize the benefits of solar energy, the demand for efficient and reliable inverters will rise.    Conclusion    The inverter market in Africa is at a pivotal point, with substantial opportunities for growth driven by renewable energy adoption. As the continent seeks to address its energy challenges, inverters will play a crucial role in facilitating the transition to sustainable energy solutions.  

   Role of Hybrid Inverters    Hybrid inverters are versatile devices that combine the functionalities of solar inverters and battery inverters, facilitating the integration of renewable energy sources with energy storage systems. Here’s an overview of their key roles:    1. Energy Conversion    DC to AC Conversion: Hybrid inverters convert direct current (DC) generated by solar panels or stored in batteries into alternating current (AC) for household use and grid compatibility.    2. Integration of Multiple Energy Sources    Solar and Battery Management: They manage energy from solar panels and battery storage, ensuring optimal use of renewable energy and enabling users to store excess energy for later use.    3. Grid Interaction    Grid-Tied Functionality: Hybrid inverters allow the connection to the electrical grid, enabling users to sell excess energy back to the grid and draw power when solar generation is insufficient. Net Energy Metering: They facilitate net metering, allowing users to receive credits for surplus energy fed back into the grid.    4. Load Management    Smart Load Control: These inverters monitor energy consumption and manage loads effectively, optimizing the use of solar energy and reducing reliance on grid power. Priority Settings: Users can prioritize certain loads, ensuring critical appliances remain powered during low solar generation periods.    5. Backup Power Supply    Uninterruptible Power Supply (UPS): Hybrid inverters provide backup power during grid outages, ensuring continuous operation of essential appliances by switching to battery power automatically.    6. Monitoring and Analytics    Real-Time Monitoring: Many hybrid inverters come with integrated monitoring systems, providing real-time data on energy production, consumption, and battery status via user-friendly interfaces or mobile apps. Performance Optimization: By analyzing performance data, users can optimize energy usage, enhance system efficiency, and identify maintenance needs.    7. Safety Features    Protection Mechanisms: Hybrid inverters are equipped with safety features such as overload, short-circuit, and thermal protection, ensuring safe operation and preventing damage to the system. Compliance with Standards: They meet relevant safety and performance standards, providing reliability and peace of mind for users.    Conclusion    Hybrid inverters play a crucial role in modern energy systems by enabling the seamless integration of solar energy generation, battery storage, and grid interaction. Their multifunctionality enhances energy independence, optimizes energy management, and contributes to sustainable energy practices, making them increasingly popular in residential and commercial applications.  

Mechanism reportedly intended to ensure security of supply from 2028 on amid rapidly rising share of renewable energy   Germany’s government in October plans to decide on the key points of a capacity mechanism for backup power and storage needed to smooth out a growing share of intermittent renewable energy in the electricity system.   The timetable is part of a growth initiative presented by Chancellor Olaf Scholz’s Social Democrat-Green-Liberal coalition in the wake of a recent budget compromise that also included a controversial proposal to change the way subsidies for renewable power are paid, the Tagesspiegel newspaper said. “It is planned that the capacity mechanism will ensure the security of electricity supply from 2028 onwards by offering operators bonuses for providing secure capacity,” the newspaper wrote in a newsletter.   “The mechanism will see run-of-river power plants, pumped storage, battery storage, bioenergy plants, other back-up power plants as well as storage and flexible loads compete against each other, according to the federal government's idea.” Renewables have met a record 58% of Germany’s power consumption during the first half of this year (up from 52% a year earlier), and their share is targeted to rise to 80% by 2030 as Europe’s largest economy is pushing to reach net-zero in 2045. But while Germany is ahead among the world’s biggest economies in renewable power, it is lagging behind in the build-up of storage capacity. The economics and climate ministry will shortly present a paper with various options for subsidies under the capacity mechanism, which subsequently will be discussed on a new platform for a climate-neutral power system. The capacity mechanism is supposed to substitute the power plant security law which temporarily regulates support for the construction of hydrogen-ready gas-fired power plants.   Tenders under this regime are slated to start in the first quarter of next year (instead of still this year as originally planned), according to sources close to the economics and climate ministry, Tagesspiegel said, adding that 7.5GW are slated to be auctioned off for decarbonisation and 5GW for the security of supply. The industrial sector is pointing to possible bottlenecks already and is pushing for a fast decision.   "In the report on the assessment of security of supply (ERAA) prepared by the European transmission system operators, load shortfalls cannot be completely ruled out as early as 2028," Christian Seyfert, general manager of the association of industrial energy and power industries (VIK), is quoted as telling Tagesspiegel.

Time to Go Global or Fall Behind! Global Energy Storage Market Overview Recently, two pieces of news have drawn significant attention in the energy storage industry. The first news came on July 2, with Tesla releasing its Q2 2024 production and delivery report. The report shows that Tesla’s energy storage installations reached 9.4 GWh in Q2, marking a year-over-year increase of 157% and a quarter-over-quarter increase of approximately 132%. This set a new quarterly record for energy storage installations, reflecting astonishing growth. The second news broke on July 5, with Beijing Energy’s Ulanqab project in Inner Mongolia announcing the bid winners for its 300 MW/1200 MWh integrated wind-solar-thermal-hydrogen energy storage system equipment procurement. CRRC Zhuzhou won the pre-bid at a unit price of 0.495 yuan/Wh for a 1.2 GWh energy storage system. The project attracted 29 companies, with bid prices ranging from 0.4699 yuan/Wh to 0.625 yuan/Wh. Notably, six companies offered prices below 0.5 yuan/Wh. Reflecting on the average bid price of 1.08 yuan/Wh for energy storage systems in August 2023, it’s clear how rapidly prices have fallen in less than a year. This year, the trend “no lowest, only lower” continues to be the norm in China’s domestic energy storage industry. These two pieces of news clearly show that under the intense domestic competition, going global has become the only hope for Chinese energy storage companies.   “Whoever goes overseas is the hero of the company!”   An insider revealed that CATL (Contemporary Amperex Technology Co., Limited) had its employees set a unified desktop background with the slogan “Whoever goes overseas is the hero of the company!” In May 2024, CATL Chairman Robin Zeng issued the company’s first president’s office document of the year, personally overseeing overseas business. He noted that while domestic competition is fierce, CATL’s market share abroad has matched international competitor LG and still has significant growth potential. This move is seen as CATL’s signal to fully accelerate its overseas market expansion.   Financial reports show that CATL’s overseas revenue reached 130.992 billion yuan in 2023, a year-on-year increase of 70.29%, accounting for 32.67% of its total revenue, up from 23.41% in 2022. Similarly, Gotion High-Tech saw its overseas revenue grow by 115.69% in 2023, with its share of total revenue increasing by 7.41%.   In June 2024, EVE Energy announced that its subsidiary EVE Energy Storage signed another strategic cooperation agreement with leading American system integrator Powin for a 15 GWh battery deal, further enhancing its global manufacturing, delivery, and cooperation capabilities. Previously, EVE had signed agreements with Powin for 1 GWh and 10 GWh of lithium iron phosphate energy storage batteries in 2021 and 2023, respectively.   Indeed, it’s not just EVE. Chinese companies like CATL, REPT Battero, Gotion High-Tech, Penghui Energy, Hithium, and Far East Battery have signed overseas energy storage battery orders totaling over 32 GWh recently. This impressive achievement in an era of intense competition indicates the high recognition of Chinese energy storage products in the international market.   According to the General Administration of Customs, in 2023, China exported lithium batteries worth $13.549 billion to the United States, accounting for 20.8% of total exports. The U.S. has been the largest destination for Chinese lithium battery exports for four consecutive years from 2020 to 2023.   From January to May 2024, China’s cumulative exports of energy storage batteries reached 8.4 GWh, a year-on-year increase of 50.1%, significantly outpacing the 2.9% growth rate for power batteries in the same period. Particularly in May, energy storage battery exports hit 4 GWh, a year-on-year increase of 664%, signaling a peak period for Chinese energy storage batteries going abroad.   Research by China Energy Storage Network shows that domestic energy storage projects generally have profit margins below 8%, while overseas markets see profit margins close to 20%. Companies like CATL and EVE, which ventured abroad early, report that their overseas revenue growth and profit margins far exceed their domestic operations. CATL’s recent “No. 1 document” and EVE’s plan to exceed 50 GWh in energy storage shipments by 2024 highlight their focus on expanding overseas markets.   Similarly, PCS (power conversion system) companies find higher profit margins in overseas markets, often exceeding 30%. For example, Deye’s inverter profit margin is 52.3%, Aiswei’s is 39.90%, Hoymiles’ is 35.81%, and Kehua’s is 33.36%. High overseas profits enable some PCS companies to achieve growth despite challenging market conditions.   The U.S. and Europe remain major export markets   Globally, the U.S. and Europe are the main export markets for Chinese energy storage products. Thanks to the Inflation Reduction Act, which provides a 30% tax credit, the U.S. energy storage battery market is rapidly growing. It’s predicted that from 2023 to 2025, the U.S. market’s compound annual growth rate will reach 88.5%, and by 2030, North America’s energy storage market demand will exceed 200 GWh. Similarly, Europe’s market is expected to deploy about 200 GW of battery power capacity by 2030.   According to Wood Mackenzie and the American Clean Power Association’s Q1 2024 energy storage monitor report, the U.S. saw robust growth in grid-scale and residential energy storage markets in the first quarter of 2024, while commercial and industrial storage significantly declined.   In Q1 2024, the U.S. deployed 993 MW/2952 MWh of grid-scale energy storage, with California, Texas, and Nevada accounting for 90% of the new capacity. This set a new quarterly record, growing 84% compared to Q1 2023. Grid-scale energy storage awaiting interconnection grew by 10% year-over-year, with 426 GW of systems waiting to be connected.   Due to a significant cost decrease, the average deployment cost for U.S. grid-scale storage systems dropped from $1776/MWh in Q1 2023 to $1080/MWh in Q1 2024, a 39% reduction. By the end of 2024, the total installed capacity of U.S. grid-scale energy storage systems is expected to grow by 45%, reaching 11.1 GW/31.6 GWh, with an estimated 62.6 GW/219 GWh to be deployed over the next five years.   Additionally, the U.S. installed approximately 250 MW/515 MWh of residential storage systems in Q1 2024, growing 8% from Q4 2023. Residential solar installations increased by 48% year-over-year in the same quarter.   California’s residential storage installations in Q1 2024 tripled compared to the previous year. Wood Mackenzie predicts that the U.S. will deploy 13 GW of distributed energy storage over the next five years, with residential systems accounting for 79% of this capacity.   As another major market, Europe saw 64% of global residential storage installations in 2023. Despite a drop in natural gas prices and residential electricity costs in 2024, they remain historically high, keeping demand for residential storage strong. For instance, in Germany, the payback period for installing a photovoltaic system alone is about 7.2 years, while adding storage reduces it to 6.0 years, making residential solar and storage systems economically viable.   After a roughly year-long inventory reduction cycle, Europe’s residential storage inventory has mostly cleared. Some European distributors have started increasing orders since June 2024, although demand sustainability remains to be seen as Q3 enters the holiday period.   Germany, the UK, and Italy continue to lead Europe’s storage market, with new installations in 2023 estimated at 5.5/4.0/3.9 GWh respectively, showing year-over-year increases of 60%, 70%, and 91%. Wood Mackenzie forecasts that by 2031, Europe’s large-scale storage installations will reach 42 GW/89 GWh, with the UK, Italy, Germany, and Spain leading the market.   Cost remains a key advantage for going global   Although it is well known that venturing abroad is highly attractive, it also comes with numerous challenges. Since April this year, the European Union has imposed several restrictions on Chinese new energy enterprises, enacting the Foreign Subsidies Regulation and subsequently launching anti-subsidy investigations into Chinese photovoltaic and wind power companies. Meanwhile, the United States has increased tariffs, raising the tariff on storage batteries from 7.5% to 25% by 2026, implementing trade protectionism. Consequently, Chinese energy storage companies entering the European and American markets will face higher tariffs and trade barriers, directly impacting their export profits and market competitiveness. China Energy Storage Network noted that CATL Chairman Zeng Yuqun identified geopolitical issues as the biggest challenge in CATL's efforts to go global. It's important to note that, in addition to the aforementioned restrictions, the U.S. government announced a significant increase in tariffs on lithium battery products imported from China. The tariff rate on electric vehicle lithium batteries will rise from 7.5% to 25% this year, and the tariff on non-electric vehicle lithium batteries will increase from 7.5% to 25% by 2026. However, energy storage batteries are not currently subject to FEOC restrictions. Projects that meet ITC localization requirements can receive a 10% production tax credit, but the cost gap between American-made batteries and Chinese lithium iron phosphate batteries remains much larger than 10%. According to Bloomberg New Energy Finance, the global average price of a 4-hour energy storage system in 2023 is $263/kWh, down 24% year-on-year. The average cost in China is 43% lower than in Europe and 50% lower than in the U.S. Even with a 25% tariff increase on battery cells, Chinese cell costs are still approximately 26% lower than in the U.S., maintaining a significant cost advantage. Industry consensus is that the U.S.'s "2-year buffer period" for tariffs on Chinese energy storage batteries indicates a high demand and dependency on these batteries. China has a mature lithium battery industry chain and large-scale production bases, providing a clear scale advantage. Even with the addition of ITC localization subsidies and a 25% tariff, Chinese energy storage batteries will still have a cost advantage. Some analysts believe that the tariff increase on energy storage batteries starting in 2026 will prompt U.S. energy storage owners to complete installations earlier, leading to a surge in installations in 2024 and 2025. This could create new growth opportunities for Chinese energy storage exports in the second half of 2024. Industry insiders note that with the release of battery supply and intensified price competition in the energy storage market, companies will see significant differentiation in revenue growth and profitability. Companies with strong capabilities in securing overseas orders will experience notable growth in volume and profit. In the future, enterprises with global business layouts, vertically integrated industry chains, and robust financing capabilities will have a competitive edge in market share and profitability. "As the domestic market becomes increasingly competitive, energy storage companies must seize the opportunity to go global in the second half of this year or risk being eliminated." Of course, the process of going global for energy storage companies will not be as rapid as in e-commerce, gaming, or finance. It requires understanding local business rules and international policies and meticulous, diligent work akin to "plowing a field." Under the influence of geopolitical factors, companies cannot engage in geopolitical arbitrage; they must integrate into local industrial systems to reap more substantial benefits.   Global Energy Storage Market Demand Overview! Germany The energy storage market is projected to reach a scale of 15 GW/57 GWh by 2030.   In December 2023, the German government announced an energy storage strategy. This strategy, released by the Federal Ministry for Economic Affairs and Climate Action (BMWK) on December 19, 2023, aims to support energy storage deployment and achieve the "optimal integration" of storage systems with the power system. The release of this strategy marks the first time energy storage systems have been placed on Germany's political agenda. The BMWK stated that Germany's renewable energy targets include deploying 215 GW of solar power and 145 GW of wind power facilities by 2030, necessitating the integration of more energy storage systems. The strategy identifies 18 distinct areas where measures can be appropriately taken to promote energy storage deployment. These include the role of storage systems under the German Renewable Energy Act (EEG), accelerating grid construction, promoting battery and component production, and removing obstacles to the development of pumped hydroelectric storage (PHES) power facilities and grid charging plans. Fluence, along with four other active energy storage developers and integrators in the German market, recently commissioned consulting firm Frontier Economics to write a report analyzing the demand for energy storage systems in the German grid. The report found that with a supportive policy framework in place, Germany's energy storage system deployment could grow to 15 GW/57 GWh by 2030 and to 60 GW/271 GWh by 2050. By mid-century, these operational storage systems could provide Germany with approximately 12 billion euros (13.04 billion USD) in economic benefits and reduce wholesale electricity prices. The growth of renewable energy and the need for energy independence are the macro drivers of the German energy storage market's recovery. Currently, Germany's battery storage market is on a fast development track, with a recent analysis by the Fraunhofer Institute for Solar Energy Systems (Fraunhofer ISE) indicating that the scale of battery storage systems deployed in Germany nearly doubled over the past year, from 4.4 GW/6.5 GWh at the end of 2022 to 7.6 GW/11.2 GWh by the end of 2023. The installed capacity of grid-connected pumped hydro storage remains at 6 GW, with no growth. According to Fraunhofer ISE, in 2023, Germany's wind and solar power generation of 260 TWh met 57.1% of the country's electricity demand, compared to 242 TWh and 50.2% in 2022. To stimulate the household market, the Annual Tax Act passed by the Bundestag in 2023 exempts household PV systems of less than 30 kW from income tax (14-45%); multi-family hybrid use properties with PV systems of less than 15 kW are also exempt from income tax; and the purchase of PV and storage systems is exempt from value-added tax (VAT, 19%), effectively simplifying the VAT exemption process. Additionally, the Solar Power for Electric Cars subsidy program released by KFW Bank in September 2023 provides financial subsidies for household integrated solar power and storage systems, with a total amount of 500 million euros. The subsidy covers about 25% of the total cost, with a maximum subsidy of 10,200 euros per household, benefiting at least 50,000 systems. However, data shows that in 2023, about 400,000-500,000 household storage systems were installed in Germany, indicating that the subsidy volume is limited.   Italy: 2030 Additional 71 GWh of Long-Duration Energy Storage In 2023, the European Commission approved Italy’s €17.7 billion energy storage investment plan. This plan is expected to add 9 GW/71 GWh of long-duration energy storage by 2030. The EU’s approval of Italy’s energy storage investment signifies a firm commitment to supporting renewable energy development and highlights the growing emphasis on building long-duration balancing resources. Under frameworks such as “Fit for 55” and “RePowerEU,” more countries are expected to propose energy storage investment plans, potentially accelerating large-scale energy storage development in Europe. Local developers in Europe have already secured GW-level energy storage construction contracts in Italy, and Chinese suppliers are expected to enter the European large-scale energy storage construction supply chain. The European Commission stated that this measure will contribute to achieving the goals of the European Green Deal and the “Fit for 55” package. The “Fit for 55” initiative aims to reduce the EU’s net greenhouse gas emissions by at least 55% by 2030. According to research by Italian grid operator Terna SpA, the Fit-for-55 2030 scenario will require the development of approximately 71 GWh of new utility-scale storage capacity. In other words, by 2030, Italy needs to deploy a total of 71 GWh of renewable energy storage to decarbonize its energy system and meet the EU’s targets. It is worth noting that the Italian government’s Ecobonus subsidy, introduced in 2020, began to phase out in 2023. The tax reduction for household energy storage equipment increased from the original 50-65% to 110% (extended to 2024), with payment spread over five years. This will gradually decrease to 90%, 70%, and 65% in 2023, 2024, and 2025, respectively.   United Kingdom: Planned or Deployed Storage Systems of About 61.5 GW   The UK, being Europe’s most mature large-scale energy storage market, significantly raised its short-term energy storage installation targets in the latest future energy vision plan. According to Solar Media, by the end of 2022, the UK had approved 20.2 GW of large-scale storage projects, expected to be completed within the next 3-4 years. Planned or deployed storage systems amount to approximately 61.5 GW. Wood Mackenzie predicts that the UK will lead Europe in large-scale energy storage installations, reaching 25.68 GWh by 2031, with significant advancements expected in 2024. Additionally, the UK’s energy storage demand may be further driven by government incentive policies, such as the new energy storage battery tax exemption policy introduced in December 2023. Effective February 1, 2024, the policy removes the 20% VAT on the installation of energy storage battery systems (BESS), which previously applied only to batteries installed simultaneously with solar panels, benefiting household solar storage systems significantly.   Greece: Expected to Add Over 16 GW of Solar PV Capacity by 2030   In 2023, Greece ranked first in Europe for the proportion of domestic electricity generated by solar PV, more than twice the European average (8.6%) and three times the global average (5.4%). Greece’s grid-connected solar PV capacity is expected to exceed 1.7 GW by 2024. The Hellenic Association of Photovoltaic Companies (HELAPCO) forecasts that Greece will add over 16 GW of solar PV capacity by 2030. However, the National Energy and Climate Plan (NECP) projects only 3.1 GW of Battery Energy Storage Systems (BESS) by 2030, which is insufficient to keep curtailment at reasonable levels. Energy storage is needed to address curtailment issues, with the first large-scale ground-mounted PV stations equipped with storage expected to be operational by 2026, helping to alleviate curtailment. ### Spain: Deployed Approximately 495 MWh of User-Side Storage Systems in 2023 According to recent data released by the Spanish Solar Association (UNEF), by the end of December 2023, Spain had deployed a total of 25.54 GW of solar power facilities, with 5.59 GW added in 2023 alone. By the end of 2023, Spain’s cumulative energy storage capacity reached 1,823 MWh, with approximately 495 MWh of user-side storage systems deployed in 2023, and residential storage systems accounting for about three-quarters of the total storage capacity. This significant growth indicates a strong attraction of energy storage businesses in Spain’s renewable energy market, which is expected to maintain robust growth.   Romania: Deployment of Approximately 2.5 GWh of Battery Energy Storage Systems by 2030   Recently, the Romanian House of Representatives passed the new Bill 255/2024. This regulation mandates that households with 10.8 kW to 400 kW photovoltaic systems must install energy storage systems by December 31, 2027. Failure to install these systems on time will result in the power output of their photovoltaic systems to the grid being limited to 3 kW. The bill states that Romania currently has a significant amount of excess solar power being fed into the grid, exacerbating grid congestion issues. Therefore, the mandatory installation of household energy storage systems is an essential step. As of the end of April, the household photovoltaic installed capacity in Romania reached 1.707 GW, surpassing the country's cumulative utility-scale photovoltaic installed capacity of 1.636 GW. The mandatory storage policy is expected to bring new growth to the local household energy storage market in the short term. Enache Company indicated that Romania needs to deploy approximately 2.5 GWh of battery energy storage systems to accommodate its renewable energy deployment growth, a plan that is expected to be easily achieved before 2030. Like many other European countries, Romania is receiving deployment funds from the EU's Recovery and Resilience Facility to support the deployment of energy storage systems and other clean energy generation facilities.   Southeast Asia: Cumulative Energy Storage Market Growth Nearing 15 GWh from 2020 to 2030   Geographically, Southeast Asia consists of numerous islands, with some archipelago nations having primarily off-grid electrical systems. The weak power infrastructure, combined with the dispersed island populations and poor overhead line standards, creates significant opportunities for distributed rooftop photovoltaic storage (self-consumption). In the Philippines, for example, many remote islands are not connected to the grid, and natural disasters are frequent, making energy storage essential for its power supply market. Data indicates that the Philippines will accelerate renewable energy construction in the future, with an expected energy storage capacity of 6 GW. In terms of policy, various countries have introduced relevant incentives, promoting local energy storage installation demand. For instance, in May 2023, Vietnam released the "Eighth Power Development Plan," aiming to halt coal power projects by 2030 and cease coal-fired power generation by 2050. By 2030, Vietnam's photovoltaic power plants are expected to increase to 12 GW, with energy storage reaching 2.7 GW. The Philippines released a renewable energy plan and conducted the second green energy auction program (GEAP) in July 2023, awarding 3.4 GW of wind and photovoltaic projects slated for development from 2024 to 2026, which will also drive energy storage installation in the Philippines. Notably, the Philippines has lifted the 40% foreign ownership cap in local renewable energy projects and included electric vehicles, renewable energy, energy storage, and other green ecosystem industries in the "Priority Investment Areas for Foreign Investment," offering various tax incentives. In the second half of 2023, Malaysia released its National Energy Transition Roadmap (NETR), with clear plans for the development of rooftop solar and energy storage projects. An official stated, "Rooftop photovoltaics are one of the easiest things to focus on to accelerate our energy transition," and mentioned that the government has allocated RM 50 million for installing solar panels on government buildings' rooftops. Countries like Indonesia, Thailand, Singapore, and Cambodia are also promoting renewable energy development through various measures. Meanwhile, the rapid cost reduction of domestic lithium battery products in 2023 is highly attractive to the Southeast Asian region, which has a strong demand for energy storage and is sensitive to price. This has greatly stimulated installation demand. According to incomplete statistics, the Southeast Asian market accounted for only 2% of the global newly commissioned energy storage projects in 2022, but demand grew rapidly in 2023, with key markets including Thailand, Malaysia, the Philippines, Vietnam, Indonesia, and Singapore. It is estimated that from 2020 to 2030, the cumulative new energy storage market in ASEAN will approach 15 GWh. Industry insiders predict, "In the next 3-5 years, the Southeast Asian market will undoubtedly be one of the fastest-growing markets globally."   India: New 4 GWh of Battery Storage Capacity in 2024   In 2024, India's much-anticipated large-scale grid-connected battery subsidy guidelines will bolster the latest policies aimed at enhancing power system flexibility. Developers of successful projects will be selected through competitive bidding, with the implementing agency bearing the commercial risks. This developer-friendly scheme is expected to result in oversubscribed bids. According to the Indian government's plan, intermittent renewable energy will account for 25%-55% of India's power generation structure by 2030. In 2024, the Indian government will subsidize 4 GWh of grid-application battery storage with a total subsidy amount of INR 94 billion (approximately USD 1.13 billion). Successful bidders will be selected through multiple rounds of bidding and will have 24 months to commission the projects, receiving subsidies in five installments starting from financing completion. According to BloombergNEF calculations, this subsidy can support 7.2-9.8 GWh of battery storage capacity, roughly double the 4 GWh target. ### Pakistan: Projected 12.8 GW of Solar PV Capacity by 2030 Customs data shows that from January to April this year, China's exports to Pakistan of photovoltaic modules, inverters, and lithium batteries amounted to RMB 7.83 billion, 779 million, and 330 million, respectively, with year-on-year growth of 110%, 170%, and 250%, indicating explosive growth. The surge in Pakistan's solar storage market is similar to that of South Africa and is closely related to the fragile local power market environment. The country's grid frequently experiences load shedding due to insufficient generation capacity and outdated transmission and distribution networks with high line losses. Particularly during peak summer periods, the grid is overwhelmed, and blackouts are common. Moreover, electricity prices in Pakistan are relatively high, around 17.5 cents/kWh, far exceeding those in India (10.3 cents), Bangladesh (8.6 cents), and Vietnam (7.2 cents), forcing households and businesses to consider cheaper alternatives. As the cost of solar storage continues to decline, users can reduce overall electricity costs through self-built solar storage systems. According to the "Indicative Generation Capacity Expansion Plan (IGCEP2047)" released by NEPRA, Pakistan's solar PV capacity is expected to reach 12.8 GW by 2030 and 26.9 GW by 2047.   Middle East and Africa: Expected New Energy Storage Installations of 3.8 GW/9.6 GWh in 2024   In emerging markets such as the Middle East and Africa, South Africa and Israel, as the two main incremental markets, have both set clear energy storage installation plans and certain subsidy policies. With strong demand, these markets are expected to drive high growth in energy storage demand in the Middle East and Africa. Currently, demand in the Middle East and Africa markets is mainly driven by government tender projects. The high growth in photovoltaic installations has highlighted consumption issues, and favorable policies combined with a hot tender market are expected to lead to a coordinated explosion in distributed and large-scale storage demand, resulting in strong growth. South Africa is a typical energy storage market driven by rigid demand. With the gradual emergence of large-scale storage increments, South Africa's new installations are expected to maintain high growth, reaching 3 GWh in 2024. Israel aims to achieve energy independence with multiple promotion policies, and with the upcoming deadline for large-scale storage projects to be connected to the grid, Israel's new installations are expected to reach 3.4 GWh in 2024, growing by over 200% year-on-year. According to the Arab Petroleum Investments Corporation report, between 2021 and 2025, approximately 30 energy storage projects are planned in the region. Additionally, the BMI report from Fitch Solutions indicates that the UAE and Saudi Arabia in the Middle East are preparing large-scale energy storage projects. For example, Saudi Arabia's large-scale infrastructure project NEOM includes an energy storage plan called ENOWA, with a storage capacity of 2,200 MW. Saudi Arabia's "Vision 2030" plan aims for 50% of energy to come from renewable sources by 2030. It is noteworthy that the UAE ranks eighth globally in planned and under-construction projects.   Australia: Energy Storage Capacity Expected to Increase to 61 GW by 2050   This year, the Australian federal government reached agreements with states to establish a capacity investment plan, allowing BESS to bid to fill anticipated reliability gaps. The electricity and ancillary services day-ahead spot market provides diversified revenue channels for energy storage. By 2050, the capacity from electrochemical storage, virtual power plants, and pumped hydro storage is expected to increase to 61 GW.

The Critical Juncture for Solid-State Batteries? As one of the hottest investment areas in battery technology, solid-state batteries have distinct advantages over traditional liquid batteries in terms of energy density and safety. They are widely regarded as the most promising next-generation battery technology. With the scale production of solid-state batteries, does this mean that the industry has reached a commercial breakthrough? Recently, China Science and Technology Fusion Energy has successfully scaled up production and rolled out its 628Ah and 314Ah solid-state batteries. As one of the most popular investment fields in batteries, solid-state batteries have notable advantages over traditional liquid batteries in terms of energy density and safety, garnering widespread attention within the industry. With the scale production of solid-state batteries, does this signal a commercial milestone for the industry?   Acceleration of Semi-Solid Battery Industrialization   Currently, the mainstream lithium batteries in the market use liquid electrolytes as transmission carriers. Under abnormal conditions such as overcharging or internal short circuits, the liquid electrolyte can easily heat up, decompose, and generate gas, potentially leading to battery fires or explosions. Replacing liquid electrolytes with solid electrolytes can fundamentally solve the safety issues of lithium batteries, while also meeting the demand for higher energy density and better performance. It is understood that the solid-state batteries being discussed in the industry typically refer to semi-solid batteries, quasi-solid batteries, or solid-liquid hybrid batteries with a reduced electrolyte content of 5%-15%. These retain some liquid electrolyte, making them feasible for mass production in terms of material design, manufacturing process, equipment production, and cost. "Leveraging the robust manufacturing foundation of the new energy industry chain, Chinese battery companies have made significant breakthroughs in the research and development of solid-state battery technology and industrial chain layout. With the mass production of semi-solid batteries by Chinese companies such as WeLion New Energy, Qingtao Energy, and Ganfeng Lithium, semi-solid batteries have truly achieved industrialization in an economic sense," said Yu Qingjiao, Secretary-General of the New Battery Technology Innovation Alliance of Zhongguancun, at the recent 2024 Solid-State Battery Industry Ecosystem Summit. He pointed out that the commercial application of solid-state batteries is approaching, and whoever captures the high ground of the industry first will gain the initiative in development.   Challenges in Fully Solid-State Battery Commercialization   Despite the mass production and application of semi-solid batteries, the commercialization of fully solid-state batteries still faces a series of challenges in terms of technology and cost. Replacing liquid electrolytes with solid electrolytes involves a core technical issue of material selection. The industry has explored three main solid-state battery systems: polymer, sulfide, and oxide. Polymer solid electrolytes are easy to process, compatible with both dry and wet manufacturing processes, and have the lowest mass production difficulty, but have low conductivity. European companies mostly focus on this technical route. Sulfides have the best performance but are sensitive to moisture in the air and most polar solvents, and the manufacturing of cells requires pressure from isostatic pressing equipment, leading to high costs. Chinese companies like CATL, BYD, and EVE Energy favor this technical route. Some startups opt for the oxide route. "Fully solid-state batteries represent a comprehensive innovation upgrade in materials, cell manufacturing processes, and manufacturing equipment. The industrial chain will undergo revolutionary changes," said Miao Lixiao, General Manager of Frontier Technology R&D at SVolt Energy. He noted that solid-state batteries face challenges in system design and recycling. For example, during manufacturing, liquid batteries use separators to wrap around the electrodes to prevent misalignment that could cause short circuits, and they do not require ultra-high pressure densification. However, solid-state batteries lack separators, and the stacked layers are densified under ultra-high pressure, making the edges of the electrodes prone to breaking and misalignment, making insulation on the cell sides challenging. "Solid-state batteries are like hamburgers, layered with ingredients that can spill out from the edges under pressure, leading to short circuits, while liquid batteries are like rolled pancakes, wrapped to avoid short circuits." Currently, the cost of solid-state batteries is higher than that of liquid batteries. Miao Lixiao cited that "the cost of sulfide solid electrolyte materials is extremely high, reaching 20,000 yuan per kilogram, with the potential to drop to 5,000 yuan per kilogram in the future. However, solid electrolytes account for over 20% of the cell mass, and such prices are likely unacceptable in the market." Pitao, Chairman of Hunan Zhongke Xingcheng Graphite Co., Ltd., pointed out, "Every company has its own technical characteristics. Due to the uncertainty of technical directions, the upstream industrial chain is in a wait-and-see state. Solid-state batteries need a relatively determined direction for upstream and downstream to configure products accordingly, avoiding greater sunk costs in capital investment."   Achieving 1+1>2 Through Composite Material Design   Due to unclear technical routes and cost reduction spaces, companies in the industry are choosing to gradually transition from semi-solid to fully solid-state. "There are differences in the fully solid-state battery route, and differentiated competition will promote the expansion of solid-state battery applications," said Xu Hangyu, Director of Scientific Research and Development at WeLion New Energy. He believes that currently, a single solid electrolyte material cannot meet the needs of fully solid-state batteries. Combining liquid and solid electrolytes is one solution, compensating for the shortcomings of single electrolyte materials while being compatible with most traditional liquid lithium battery processes and equipment, reducing costs. Combining the advantages of oxide and polymer solid electrolytes, WeLion New Energy has industrialized mixed solid-liquid batteries, with products used in small power, new energy vehicles, and energy storage fields. "Each type of material has its own advantages and disadvantages. Through composite material design, 1+1>2 can be achieved," said an industry insider, who also believes that composite solid-state batteries are an effective way to achieve large-scale production. "Solid-state batteries cannot be made into a work of art, with products being very expensive, several times or even ten times more than liquid batteries, which would never be feasible for vehicle applications." Su Min, Director of the Cell Materials R&D Department at Wanxiang 123 Co., Ltd., believes that whether semi-solid or fully solid-state, there is an optimal energy density. There is no single best technology solution; all are technical means to address safety risks under high specific energy needs. Overcoming the technical and industrialization issues of fully solid-state batteries requires the collective efforts of the entire industry.