Amid green efforts nationwide to achieve carbon goals, experts call for more breakthroughs in industry to tackle key issues

Buoyed by the rapid growth in the renewable energy industry and strong policy support, China's development of power storage is on the cusp of a growth spurt which will generate multi-billion dollar businesses, experts said.

An AVIC Securities report projected major growth for China's power storage sector in the years to come: The country's electrochemical power storage scale is likely to reach 55.9 gigawatts by 2025－16 times higher than that of 2020－and the power storage development can generate a 100-billion-yuan ($15.5 billion) market in the near future.

Industry estimates show that China's power storage industry will have up to 100 million kilowatts of installed capacity by 2025, and 420 million kW installed capacity by 2060, attracting related investment of over 1.6 trillion yuan, said Li Jie, general manager of power storage at State Grid Integrated Energy Service Group Co Ltd.

CITIC Securities also forecast that development of new types of power storage and pumped-storage hydroelectricity is set for explosive growth during the 14th Five-Year Plan period (2021-25).

Experts said developing energy storage is an important step in China's transition from fossil fuels to a renewable energy mix, while mitigating the impact of new energy's randomness, volatility, intermittence on the grid and managing power supply and demand.

"Developing power storage is important for China to achieve green goals. With increasing use of wind and solar power, the market prospect of power storage is very promising," said Liu Jing, associate dean and professor of accounting and finance at the Cheung Kong Graduate School of Business.

"In the past, coal was merely the only source of electricity, and many grid operators do not store energy due to high costs. Instead, grid operators normally set up dispatch centers to manage power supply. Demand in peak hours is usually handled by burning more coal," said Lin Boqiang, head of the China Institute for Studies in Energy Policy at Xiamen University.

"Now, solar and wind energies are taking up more in power generation under China's green commitment, and are seeing an increase in their market share as they are becoming cost competitive and advanced in technology development. However, power supply with such energies is intermittent and difficult to be managed in accordance with the power supply.

"To this end, power storage is becoming more prominent in China's transition to green energy as it helps provide uninterrupted power supply and maintain efficient power flow when using intermittent new energies for power generation," said Lin.

The development of power storage is backed by policies. In July, the National Development and Reform Commission and the National Energy Administration co-released a guideline on power storage development.

The guideline called on local governments to roll out development plans which need to clarify goals and key missions during the 14th Five-Year plan period. It urged local governments to encourage construction of power storage projects beside electricity generation plants, and proper distribution of power storage facilities on grids.

The goal is to finish the transition of power storage industry from the early stage of commercialization to a certain scale of development with relatively mature market environment and business models by 2025.Total installed capacity of power storage facilities is expected to exceed 30 million kW by then, the guideline said.

The country expects to achieve fully market-oriented development of the power storage industry and independent research and development of core technologies and equipment by 2030.

Answering the call, local governments are stepping up efforts promoting the development of power storage.

In August, Shanxi province started to receive the first batch of applications for new energy plus power storage demonstration projects and promised preferential policies to support the development of power storage and related projects.

In the same month, Hebei province vowed to push forward construction of power storage projects beside electricity generation plants and actively promote a proper distribution of power storage system on grids. The province also promised efforts to promote cost cuts and large-scale commercialized application of lithium-ion battery projects.