Energy storage products are caught in the whirlpool of "homogenization" competition

■Reporter Lu Qixiu, China Energy News (2024-04-29 13th Edition)

　　Since the beginning of this year, major energy storage companies have released new energy storage products with larger capacity, higher energy density and longer life. The mainstream cell capacity in the market has moved from 280Ah last year to 300Ah+, and even iterated to a larger capacity. For the same 20-foot container, the capacity of the energy storage system has been upgraded from 5MWh to 5.5MWh and 6.9MWh in order to achieve better performance, less footprint and lower cost.

　　It is worth noting that in the fierce market competition, the "expansion" of battery cells and system capacity has become the unanimous force point of new products of various enterprises. More than that, the products on the market are converging in terms of appearance design, performance characteristics, marketing selling points, and even the direction of technological evolution, and the risk of homogenization is becoming more and more prominent. In the critical period of a new round of elimination of energy storage, how to find differentiated competitive advantages is becoming the key to the survival of enterprises.

　　■ Convergence of technological evolution

　　As the scale of a single energy storage project in mainland China moves from the MWh era to the GWh era, large-capacity batteries are considered to be a major direction for the upgrading and development of the industry. Entering 2024, the large-scale landing and application of 300Ah+ large-capacity energy storage cells will be accelerated, and at the same time, battery cell products and energy storage systems will show a trend of "a hundred flowers blooming", and leading companies in the industry have released 500Ah+ ultra-large-capacity energy storage cells of different specifications. In the field of systems, the 5MWh-level system has not yet been applied on a large scale, and the 6MWh+ system is coming one after another, and nearly 10 companies such as BYD, Honeycomb Energy, and Ruipu Lanjun have successively launched 6MWh+ energy storage systems.

　　With the increasing capacity and power of energy storage systems, heat dissipation has also become a key consideration in system design for safety reasons. The cooling technology of the new products of mainstream enterprises has also switched from the previous air cooling technology to liquid cooling technology. In addition, in the context of Tibet, Xinjiang and other places to encourage or force new energy projects to be equipped with grid-based energy storage, grid-based energy storage technology has also become a popular field for enterprises to compete for the first layout.

　　"At present, energy storage products are rapidly iterated on a half-year cycle, but on the whole, the products are highly homogeneous." Industry insiders said that technological innovation should be cautious, if the capacity expansion goes too fast, many standards are not supported, there are certain safety risks, and the industrial chain, supply chain, and process tooling are not supported.

　　Zheng Hua, a professor at North China Electric Power University, pointed out to the "China Energy News" reporter that on the one hand, the speed of technology iteration, personnel flow, and manufacturing technology upgrading has been greatly accelerated, and the gap between the manufacturing processes and marketing methods of various leading manufacturers is getting smaller and smaller; On the other hand, the criteria for judging the "good and bad" of energy storage are not perfect, or even missing, and the problem of "building but not using" has led to the use or commercial value of energy storage not being effectively verified and played. This will lead to the problem of bad money driving out good money, resulting in huge investment waste and harming the high-quality development of the energy storage industry.

　　■ Market competition has been further intensified

　　In recent years, the new energy storage industry has flourished and has become one of the hotspots that has attracted the most attention. Tianyancha data shows that at present, there are more than 100,000 companies in the field of energy storage, and the number of newly registered energy storage-related enterprises is as high as tens of thousands within a year, and listed companies including food, liquor, real estate, toys, and ceramics have also crossed over to energy storage. The technical threshold of energy storage system is not high, many cross-border enterprises have insufficient technology precipitation, vague product positioning, lack of channel resources, and energy storage equipment is built but not used, and investors pursue low-cost distribution and storage to reduce costs, which brings soil for the growth of similar products.

　　Zhang Jianhui, chairman of Hipostron, believes that the reason for the homogenization of energy storage products lies in the simple stacking of hardware from the perspective of supply side only from the perspective of supply side in the R&D and manufacturing process of equipment, and the lack of closed-loop data management of the whole chain. Equipment manufacturers lack effective feedback on on-site operation data, and investors and operators lack front-end system modeling. Equipment R&D and manufacturing is an open-loop system, and data is completely separated.

　　The direct consequence of product homogenization is to intensify the competition between enterprises for price reduction. In the past year, the price of energy storage cells has dropped by more than half, from 0.9 yuan/Wh to below 0.4 yuan/Wh, and the average price of energy storage systems has dropped from 1.3 yuan/Wh to about 0.7 yuan/Wh, which has fallen below the product cost line of some enterprises, and the price continues to decline.

　　Judging from the latest annual performance report of listed energy storage companies in 2023, although the performance of some companies has shown high growth, it is common for revenue and profits to decline, or to increase revenue without increasing profits. This is also consistent with the rapid downward trend of energy storage systems and energy storage battery prices, and enterprises are getting deeper and deeper in the vortex of price competition.

　　According to the analysis of the research institute Advanced Industry Research Institute, in 2024, the overall supply of China's new energy storage market will exceed demand, and the competition in the integration of energy storage systems will be more brutal than that in the battery cell link, and more than 50% of energy storage system enterprises (including large storage systems, industrial and commercial storage systems, household storage systems and other enterprises) will be eliminated.

　　■ It will be tested by the market in the end

　　"The energy storage cells of each business look the same, but there are differences in detail, and the indicators are similar but not the same, but there is no essential difference in the use of users." Zheng Hua pointed out that homogenization is not the same as standardization, but it is often the prelude to standardization, technological breakthroughs or new ideas. Therefore, homogenization is not necessarily a bad thing, especially for consumers or users, to buy higher performance products at a lower cost under the premise of safety. Commodity production is for use, and lasting innovation is the key "weapon" for enterprises to be invincible in homogeneous competition.

　　Industry insiders also pointed out that homogenization is the appearance of competition in energy storage products, in fact, the cell yield, cycle times, fixed costs, etc., each company's technological innovation and data performance is not the same. As energy storage is really used and more frequently involved in grid dispatching, the real performance of products will be tested by the market.

　　"With the continuous improvement of digital and intelligent technology, product iteration and upgrading are accelerating, and homogeneous competition has no future." Liu Yong, Secretary-General of the Energy Storage Application Branch of the China Chemical and Physical Power Industry Association, pointed out to the China Energy News reporter that in the current fierce market competition, enterprises ultimately rely on cost-effective products, leading technology, rich domestic and foreign channel resources and high-quality services. The energy storage industry should carry out healthy competition and empower each other, and leading enterprises should play a leading and agglomeration effect, pioneer and innovate, and lead the upstream and downstream industry chains to jointly create cost-effective products that meet the real needs of the market.

　　"The industry urgently needs to introduce a series of access standards to build a 'moat' a little higher." Sun Wei, President of Trina Energy Storage, shared his competitive ideas, and all products must correspond to market segments. Our approach is to achieve as much unity as possible in the underlying hardware products, reduce product categories and types, achieve large-scale production, and reduce costs. In terms of configuration, especially the intelligent configuration of some software, it is continuously developed according to user needs, and has become an additional configuration item or option in the future to achieve the maximum economic value of each subdivision scenario.