The three energy storage markets in the United States, Europe, and China have exploded, and energy storage will become the main line of investment in 23 years

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Europe: Low penetration rate and high growth potential, energy storage has reached a new level. Under the European energy crisis, the high economic efficiency of European household solar storage has been recognized by the market, and the demand for solar storage has started to explode. In 2023, the electricity price of newly signed contracts in Europe will rise sharply, with an average electricity price of more than 40 euros/MWh, an increase of 80-120% year-on-year. We expect that the price will continue to be high in the next 1-2 years, and the rigid demand for solar storage is clear. Germany exempts household photovoltaic VAT and income tax, and Italy's household savings subsidy policy has been withdrawn. The favorable policy continues. The German household savings rate can reach 18.3%. Considering the subsidy payback period can be shortened to 7-8 years. The long-term independent energy trend, the penetration rate of household storage in Europe in 2021 is only 1.3%, there is broad room for growth, and the industrial, commercial and large storage markets are also growing rapidly. We estimate that the demand for new energy storage capacity in Europe in 2023/2025 will be 30GWh/104GWh, an increase of 113% in 2023, and CAGR=93.8% in 2022-2025.

United States: The ITC policy encourages the outbreak. The United States is the world's largest large-scale storage market. In 2022Q1-3, the installed capacity of energy storage in the United States was 3.57GW/10.67GWh, a year-on-year increase of 102%/93%. But energy storage still maintains rapid growth. In 2023, photovoltaic installed capacity will improve, and the penetration rate of superimposed energy storage will continue to increase, supporting the continued explosion of energy storage installed capacity. The coordination between power suppliers in the United States is poor, energy storage has practical value for regulation, ancillary services are fully open, the degree of marketization is high, and the PPA electricity price is high and the storage premium is obvious. The ITC tax credit is extended for 10 years and the credit ratio is increased to 30%-70%. For the first time, independent energy storage is included in the subsidy, which promotes a significant increase in the rate of return. We estimate that the demand for new energy storage capacity in the United States in 2023/2025 will be 36/111GWh respectively, a year-on-year increase of 117% in 2023, and CAGR=88.5% in 2022-2025.

China: The demand for policy overweight is soaring, and the 100 billion market is beginning to emerge. The domestic mandatory allocation of storage guarantees the increase of energy storage. In 2022Q1-3, the installed capacity is 0.93GW/1.91GWh, and the proportion of large storage in the structure exceeds 93%. In 2023, the ground photovoltaic capacity + energy storage penetration rate will increase, and the demand for installed capacity will grow rapidly. According to our According to incomplete statistics, the public bidding for energy storage will reach 41.6GWh in 2022; the shared energy storage model will spread rapidly, and capacity compensation, power spot market, and time-sharing price difference mechanism will be gradually implemented to increase the energy storage rate of return. New technologies such as sodium-ion batteries, liquid flow batteries, photothermal energy storage, and gravity energy storage are being implemented and gradually confirmed at the bidding end. Strengthen energy storage safety management, and gradually increase the penetration rate of high-pressure cascade, liquid cooling system, and Pack fire protection. We estimate that the demand for new domestic energy storage capacity in 2023/2025 will be 33/118GWh respectively, a year-on-year increase of 205% in 2023, and CAGR=122.2% in 2022-2025.

Taken together: the three major markets in China, the United States and Europe have exploded, and energy storage has ushered in a golden period of development. Thanks to the outbreak of China-U.S. storage and European household storage, we predict that the global energy storage capacity demand will be 120/402GWh in 2023/2025, an increase of 134% in 2023, and the CAGR will be 98.8% in 2022-2025. Considering the installed capacity There is a certain time lag between shipments and shipments, so we expect shipments to be 255/709GWh in 2023/2025, an increase of 103% in 2023, and a CAGR of 78.0% in 2022-2025. On the supply side, new entrants in the energy storage industry have emerged, and channels are king. The structure of battery cells is relatively concentrated. CATL ranks first in the world in terms of shipments, and shipments of BYD EVE Pine Energy have maintained rapid growth; energy storage inverters focus on channels and brand services, and the concentration of the structure has increased. Sunshine IGBT's ability to guarantee supply is strong in The large-scale storage market is firmly in the lead, household storage inverters enjoy high growth rates, and the shipments of household storage leaders have increased several times in a row.

In the future, new energy power generation such as scenery will replace thermal power and is expected to become the mainstream power generation method in the world. However, new energy power generation methods generally do not have power generation stability. For example, photovoltaic power generation requires sunlight and can only generate power during the day, while wind power generation requires wind. So energy storage is needed to balance power generation and discharge time. Therefore, if new energy power generation is vigorously developed in the future, the demand for energy storage will inevitably be released, and it is optimistic that energy storage will be the main line of investment in 23 years.