BYD Energy Storage Station

BYD Energy Storage Station

Lux Research in its report on battery market outlook sees a bright future for lithium-ion batteries in China.

Forecasted growth by 2025 will quadruple revenues from $1.7 billion  to $8.7 billion, while the energy in GWh will grow six times from about 5 GWh to some 31.3 GWh.

If we calculate those numbers, the average price would then fall from $340 to to $278/kWh.

Lux Research expects that 85% ($7.4 billion) of sales will be for transportation so the energy storage will account only for 15%.

"Transport applications will dominate with $7.4 billion, or 85% share of the revenues. Stationary applications will earn $1.3 billion. Overall, revenues will grow slower than volumes on account of continually falling battery and systems prices."

Lilia Xie, Lux Research Associate and lead author of the report titled, “Clearing the Haze: Demystifying Energy Storage Opportunities in China.” said:

“Besides understanding the market dynamics and producing cost-competitive products, most players in these markets will require strong partnerships to succeed.”

“Early leaders such as BYD will try their best to hold onto their positions but the diversification of the market will gradually create promising opportunities for those who operate with patience and savvy.”

Some findings were released in highlights of the report:

  • While transportation leads, stationary is a growth driver. Total demand for energy storage will grow to 31 GWh per year in 2025, with transportation again the dominant player. Transportation’s share of the market will grow to 29 GWh; the stationary market, at 2.3 GWh, is smaller but grows at a faster 30% CAGR.
  • Growth of NEVs cools. After a spike in sales of new energy vehicles (NEV) in 2014, China will settle to a more leisurely pace of growth, mainly on account of inadequate charging infrastructure. Still, the market will grow at a 19% CAGR, reaching 500,000 units in 2025, across passenger and heavy vehicles.
  • Renewables will drive stationary storage. Growth in China’s stationary storage will follow from an aggressive deployment of renewables. China leads the world in installed capacity of renewables, with plans for much more. In addition, preliminary policy developments suggest the electricity sector will implement pricing reforms, encouraging efficiency-boosting technologies including grid storage.

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