The trend of new energy has been set, and the energy storage industry is taking off.
New energy power generation is unstable, and energy storage needs arise as the times require.
Electric energy is ready for use, and dynamic balance needs to be maintained in the power system. When the power generation is too high, the electric energy needs to be converted into other forms of energy such as chemical energy or potential energy before it can be stored. In the traditional energy era, coal power is controllable and can achieve stable regulation of the power grid, so the importance of energy storage has not yet appeared. With the advent of the energy revolution era, new energy sources such as wind and solar power generation continue to become more popular, and power supply is affected by climate change. Affected by uncertain factors such as location and geographical location, it is difficult to maintain a balance of supply and demand at any time under the original power grid system. Therefore, energy storage has become an indispensable part of the new energy grid system.
Figure 1: Energy storage technology drives energy transformation
Pumped hydropower storage is currently the theme of energy storage, and new energy storage is developing rapidly.
From the perspective of energy storage structure, both global energy storage and my country's energy storage structures are dominated by pumped storage, accounting for 86.2% and 86.3% respectively. However, pumped storage is limited by geographical location. Pumped storage converts potential energy into mechanical energy and then into electrical energy. The response time is long. Therefore, new energy storage with fast response time and small limitations is gradually developing.
Electrochemical energy storage becomes mainstream new energy storage, Chinese suppliers lead the market
Electrochemical energy storage technology has the characteristics of high energy density, large operating voltage, long cycle life, and fast charging speed, so it occupies a mainstream position, while lithium batteries account for more than 10% of applications due to their leading safety, high efficiency, long cycle and other advantages. It has been rising year by year and has stabilized between 80% and 95% in the past five years. Sitting in the world's leading lithium battery industry, Chinese suppliers have increased their share of the energy storage market. In 2020, they have overtaken South Korea to become the world's largest supplier, accounting for 69%, and their leading advantages continue to deepen.
Figure 2: Electrochemical energy storage is the mainstream new energy storage, and Chinese suppliers lead the market
Household savings demand stabilizes, and the trend of all-in-one computers emerges
Diverse application scenarios and stable user needs
From the perspective of the entire power system, the application scenarios of energy storage can be divided into three major scenarios: energy storage on the power generation side, energy storage on the transmission and distribution side, and energy storage on the consumption side. Applications on the power generation and transmission and distribution sides mainly focus on the power grid. It can be commonly used for power peak shaving, system frequency regulation, renewable energy grid integration, alleviating grid congestion, delaying expansion and upgrade of power transmission and distribution equipment, etc.
Demand users in electricity-side scenarios are generally households, industry, commerce, and public institutions. Energy storage systems are mainly used for economic needs such as self-consumption of electricity, peak-valley price difference arbitrage, capacity electricity fee management, etc., and to improve power supply reliability. According to BNEF statistics, in global energy storage applications, household demand is basically stable at 20%-30%, which is much higher than industrial and commercial demand.
Household energy storage profit model: Cooperate with photovoltaics, increase the proportion of photovoltaics for self-use, and arbitrage the peak-valley price difference
Household energy storage is generally used in conjunction with rooftop photovoltaics. Currently, there are three main profit models:
Spontaneous self-use, and the surplus is connected to the grid: In the early stage of the policy, the FIT electricity price is higher than the household electricity price, and rooftop photovoltaic installations are promoted with "benchmark electricity prices and full grid access". As household power increases and FIT subsidies gradually decline, the electricity price gap widens. Overseas rooftop photovoltaic users are turning to energy storage to achieve a higher proportion of self-consumption.
Peak-valley arbitrage: California, Australia, major European countries, China, etc. all have time-of-use electricity price mechanisms. Under this mechanism, the energy storage system charges the energy storage during the low periods of the power grid at night and discharges during the peak electricity consumption during the day. By utilizing the peak The price difference is used to achieve the purpose of saving electricity costs.
Virtual power plant: This model is a distributed energy storage system integrator based on an energy software management platform that integrates distributed energy storage systems scattered on the user side, analyzes, controls and optimizes the operation of the energy storage system, and participates in grid services to obtain application benefits.
New energy vehicles are growing month-on-month, and we should pay attention to the incremental semiconductor opportunities brought by related car companies. In December, most of my country's new energy vehicles achieved month-on-month improvement in sales: BYD 235,000 units, maintaining continuous growth; new car-making forces, except Nezha, all maintained month-on-month growth: Aian 30,000 units, returning to positive month-on-month sales, Ideal 21,000 units, Wei There are 16,000 vehicles coming, 11,000 Ji Krypton vehicles, and 10,000 AITO vehicles.
Figure 3: There are three mainstream profit models for household energy storage:
Optical storage integrated machines mostly use DC coupling, which has higher overall efficiency.
Currently in the market, household energy storage systems can be mainly divided into optical storage integrated machines and energy storage split machines according to different levels of integration according to different household needs. As the name suggests, the photovoltaic-storage integrated machine integrates the photovoltaic inverter and the bidirectional converter and places them inside to form an integrated system. The integrated model mostly adopts DC coupling mode, which is ready to install and use, realizing an integrated solution of "light + energy storage" and suitable for the incremental market of simultaneous installation of household photovoltaic and energy storage systems. The energy storage split machine is suitable for the existing market of installed household photovoltaics. It usually adopts AC coupling mode internally to facilitate connection with the photovoltaic inverter of the original photovoltaic system. The efficiency of the DC coupling mode is significantly higher than that of the AC coupling mode in the mode of generating electricity during the day and using electricity at night, and this mode is in line with the electricity consumption habits of most contemporary households. The two efficiencies are about 95% and 90% respectively.
The integrated optical and storage machine is highly integrated, effectively reducing soft costs.
NREL data shows that hardware costs only account for less than 50% of the total cost of household energy storage systems. Due to its highly integrated characteristics, photovoltaic storage integrated machines do not require the installation of additional photovoltaic inverters. On the one hand, it reduces hardware costs and on the other hand It can save one-time equipment investment, simplify installation, save installation costs, facilitate after-sales maintenance, and effectively reduce subsequent soft costs. According to our calculations, the integrated optical storage machine can save about US$155/kwh compared to the split solution. According to BNEF’s prediction, the future cost reduction of soft costs will be much lower than that of lithium batteries and inverters. With the cost of hardware equipment of all-in-one computers being similar, the soft cost advantage of all-in-one computers will be further highlighted in the future.
Figure 4: Highly integrated optical and storage machines can effectively reduce soft costs
Household savings explode globally, with Europe leading the way and the United States following closely behind
Household storage installed capacity continues to grow rapidly, with Europe, the United States, Japan and Australia dominating the market. Global household energy storage installed capacity has grown steadily in recent years, with a five-year CAGR of 62.62%. The newly installed capacity in 2021 will be approximately 6.4GWh, a year-on-year increase of 116.23%. According to Statista statistics, the European market leads the household storage installed capacity, accounting for approximately 40.38% of the world's new installed capacity in 20 years, of which Germany accounted for 25.16%; the United States and Japan followed closely, accounting for 23.65% and 17.88% respectively. Australia accounts for about 90% in total.
