Portable energy storage
Portable energy storage can be considered as a 'large outdoor power bank'. This type of product is a built-in high energy density lithium-ion battery that can provide a stable AC/DC voltage output power system, with a charging capacity of usually 0.2-2kWh, and a larger output power of 100-2200W. It is equipped with various interfaces such as AC, DC, Type-C, USB, PD, etc., and is widely used in outdoor travel, emergency preparedness, and other scenarios.
Application scenarios of portable energy storage devices
As the product is accepted by the market, the application scenarios of portable energy storage continue to expand. Generally, it is limited to 1 kWh of electricity, with consumer demand below 1 kWh and rigid demand for backup electricity above 1 kWh.
(1) Less than 1 kilowatt hour: Generally used to power electronic devices when going out, which means outdoor entertainment needs, such as mobile phones, computers, drones, DSLRs.
(2) 1 kWh or above: The users of large capacity products are mainly home backup users with frequent power outages, professional level users, and outdoor users with high requirements for electrical appliances (3-15 kWh), or applied to off grid needs such as RVs, yachts, and off grid cabins. This scenario has higher demand for electricity and power (around 15 kWh); Or as a household energy storage module.
The trend of portable energy storage towards high capacity has been determined, and major manufacturers have increased investment. According to the statistics of the China Chemical and Physical Power Industry Association, the current market is mainly dominated by products with a capacity of 100-500Wh, accounting for about 50%, but its share is constantly decreasing.
On the contrary, the market share of products with a capacity of 500-1000Wh has increased, reaching 40% in 2021. The market share of products with a capacity of over 1000Wh is only 10%, but the share is also increasing. In the future, as the cost of battery cells decreases, large capacity portable energy storage products will gradually become the mainstream.
Layout of the charging range (Wh) of portable energy storage products from various companies
Market share distribution by capacity (%)
In August 2022, Huabao Xinneng launched the home energy storage brand Geneverse in San Francisco, USA, which includes two flagship products, Geneverse HomePowerPro01/02, with massive battery reserves. A single charge can power users' basic devices for up to a week, and can power refrigerators for up to 30 hours. For CPAP ventilators that improve sleep quality, they can be powered for 3-7 days, laptops can be fully charged 12-16 times, and mobile phones can be charged 150-200 times. The single unit charged capacity of the product is 1.2/2.4kwh, and multiple modules can be connected in parallel to meet high power consumption needs.
Considering the demand for portable energy storage in outdoor scenarios, with a compound growth rate of about 50%, combined with the demand for new scenarios, the portable energy storage space is vast.
Based on the number of households, outdoor activity penetration rate, and portable energy storage penetration rate in each country, the market space for portable energy storage in outdoor scenarios can be predicted. Considering population growth and the increasing penetration rate of outdoor activities in the Chinese and American markets, portable energy storage products are expected to achieve rapid demand growth under the continuous penetration of outdoor activities; The Japanese market is considering an increase in emergency preparedness demand.
Based on this calculation, it is expected that the portable energy storage market will add 24.14 million units in 2025, with a compound annual growth rate of 49% from 21 to 25 years; The newly added installed capacity can reach about 16.9Gwh, with an annual average compound growth rate of about 57%; The market space reaches 55.1 billion yuan, with an average annual compound growth rate of about 49%.
Household energy storage
Review of energy storage for overseas households:
2022: Russia-Ukraine conflict intensifies energy anxiety, and household energy storage demand grows rapidly. Since 2021, the European market has been affected by the rise in energy prices, resulting in a rapid increase in residential electricity prices. The economy of energy storage has been reflected, and the market is booming. Taking Germany as an example, in 2021, 145000 new household photovoltaic units were added, with an installed capacity of 1.27GWh, a year-on-year increase of+49%.
Future outlook:
Household energy storage: a sense of crisis and economic stimulus driven demand growth. The trend of global energy transformation is that household energy spontaneous self use is the main way.
The excessive dependence on fossil fuels in the energy structure has led to the energy crisis in Europe. In order to maintain national security, Europe is accelerating the process of energy transformation. The best way is to replace energy supply through renewable energy generation.
From the perspective of grid stability, the pressure on the grid caused by the large-scale integration of new energy is due to the government guiding power generation/user configuration of energy storage through subsidies and other policies. The underlying logic of European countries' subsidies for distributed photovoltaic+energy storage is to reduce the pressure on grid distribution through distributed systems. Therefore, the European household photovoltaic energy storage market will maintain high growth.
European household photovoltaic installation and total installed capacity (GW)
Calculate the installed capacity of distributed photovoltaics based on the number of households, and consider the penetration rate of household energy storage to obtain the installed capacity of household energy storage. Assuming that the average installed capacity per household can obtain the installed capacity of household energy storage worldwide and in various markets.
It is expected that the global household energy storage capacity space will reach 57.66GWh in 2025, with a compound growth rate of 91% from 2021 to 2025. Among them, the European market is * large, with a new installed capacity of 41.09GWh in 2025, with a compound growth rate of 112%; The US market added 7.90GWh of new installed capacity in 2025, with a compound growth rate of 71%.
Calculation of household energy storage installed capacity (GWh)
Assuming that every household is equipped with energy storage systems, the ceiling of the household energy storage market is vast.
Based on the population and average household size of each country, the number of households can be obtained. Based on the assumption of average system electrification based on mainstream product electrification in the market, it is calculated that the energy storage space for households in the United States reaches 130 million households/1725 GWh, the energy storage space for households in Europe reaches 310 million households/2727 GWh, and the energy storage space for households in Australia reaches 8.03 million households/60 GWh.
Calculation of household energy storage ceiling
Power station energy storage
China: Industrial chain cost reduction, accelerated construction of scenic spots, and growth of energy storage supporting facilities
The core driving force for the development of domestic energy storage power stations lies in the policy requirement for mandatory allocation of energy storage for new energy generation units. Each province and city has issued relevant policy documents, which have certain requirements for the proportion of energy storage configuration and charging hours. The allocation of energy storage for new energy projects has shifted from encouraging to requiring configuration. The configuration ratio is generally 10-20%, and the configuration time is usually 2 hours.
25 provinces in China have issued documents clarifying the allocation and storage of new energy, and regions such as Zhejiang, Qinghai, Xinjiang, Shaanxi and Xi'an have introduced local subsidy policies. Ten provinces have announced price documents for energy storage participating in peak shaving services, encouraging the development of grid side energy storage.
Relevant policy documents
Based on the demand for mandatory allocation and storage, energy storage installation is closely related to the rhythm of wind power photovoltaic installation. It is expected that the progress of wind power and photovoltaic construction will accelerate in 2023, which will benefit energy storage demand.
(1) Photovoltaics: The new production capacity of upstream silicon materials is expected to bring about a price reduction in the photovoltaic industry chain, and the demand for photovoltaic power station installation is expected to increase year-on-year;
Price trend of polycrystalline silicon (10000 yuan/ton)
(2) Wind power: Starting from the second half of 2021, the trend of cost reduction for wind power plants is clear, and the investment cost of wind power has significantly decreased.
Wind turbine bidding price trend (mainly on 3S platform, unit: yuan/kW)
According to our calculations, it is expected that the installed capacity of energy storage power stations will reach 35.8 GWh in 2022, and increase to 118.8 GWh by 2025, with a compound growth rate of 64% from 2021 to 2025. Among them, China and the United States are regions with a large volume, with an installed capacity of 36.3GWh in China and 45.2GWh in the United States in 2025.
Calculation of Market Space for Energy Storage Power Stations (GWh)
United States: ITC Subsidies Enhanced After IRA Act Update
The United States is the world's largest energy storage market, with a rapid growth in installed capacity of pre meter energy storage. According to EIA statistics, as of August 2022, the cumulative installed capacity of electrochemical energy storage in the US market is 6.8GW/14.8GWh. The installed capacity of energy storage in the United States has grown rapidly since 2021.
The unit will be put into operation at 3.3GW/8.4GWh in 2021, and is expected to be put into operation at 5.7GW/11.4GWh in 2022 (+77%/35% year-on-year). Currently, it is planned to be put into operation at 8.1GW/16.2GWh in 2023 (+42%/42% year-on-year). In terms of monthly installed capacity, 415.2MW/830.4MWh of new grid connected installed capacity was added in August 2022, representing a year-on-year increase of+516%/+317% and a month on month increase of+5%/3%.
Energy Storage Installation and Planning in the United States since 2020 (MW)
Energy Storage Installation and Planning in the United States since 2020 (MWh)
The catalyst for energy storage in the United States comes from the extension and enhancement of ITC subsidies under the Inflation Reduction Act, with an income tax credit limit of up to 50% of the initial investment cost, which will promote the growth of energy storage project installation. On August 16, 2022, US President Biden signed the Inflation Reduction Act, which revised ITC and PTC policies. The policy period has been extended by 10 years, and the subsidy intensity has been increased. The changes in energy storage projects include:
(1) Scope of application: Previously, only energy storage projects that were jointly built with photovoltaic technology and had at least 75% of their electricity coming from photovoltaic technology could enjoy ITC. After the update, both jointly built and independent energy storage projects could enjoy ITC.
(2) Credit limit: Previously, the ITC limit has been reduced from 30% to 26%/22%/10% in 2022/23/24. After the update, eligible projects can continue to receive 30%, while some projects that do not meet the conditions and have power greater than 1MWac have been reduced to 6%
(3) Additional Credit: 1) Domestic Manufacturing: Projects that use all American made steel products and have a domestic raw material cost accounting for 40% will receive an additional 10%/2%; 2) Energy Community: Additional credit of 10%/2%. (Low income community conditions only apply to photovoltaic and wind power projects).
The ITC credit limit has been increased, and the cost of energy storage has been reduced. Assuming an energy storage power plant of 100MW/400MWh; Annual operating days of 350 days, once every day at full capacity, with a service life of 20 years; The initial investment of the power station is $210/kWh, with a total investment of $84.1 million.
According to the current ITC tax credit policy, the credit limit for new energy distribution and storage projects is 26% for 22 years and 22% for 23 years. The calculated LCOS for energy storage is $0.130/kwh and $0.131/kwh, while the credit limit for independent energy storage projects is 0 and LCOS is $0.137/kwh. The new ITC tax credit policy (30%/40%/50%) reduces the energy storage LCOS to $0.129/kwh, $0.127/kwh, and $0.125/kwh.