Lead-carbon and lithium batteries have a promising future

On June 7, the state energy administration issued the notice on promoting the participation of power storage in the pilot work of the compensation (market) mechanism for auxiliary power services in the "three northern regions" (no. 164 of the state energy administration [2016]). The document is the final version of the notice of the state energy administration on the participation of electricity and energy storage in peak regulation assistance services in the "three northern regions" (draft for solicitation of opinions) drafted by the department of market supervision of the energy administration in March this year. It is the first substantive support policy for the energy storage industry this year. The publication time exceeded expectations, and the content was more detailed and perfect than the draft for soliciting opinions, encouraging a wider range of applications.

comments

1. The file has been clear about the electric energy storage facilities to participate in the subject status of the ancillary services market and electricity power compensation/settlement mechanism. It’s of great significance to accelerate the launch of various commercial energy storage application markets in China.

The biggest highlight of this policy "notice" is that it clarifies the independent market subject status of power storage facilities. The policy stipulates that no matter building power storage facilities on the power generation side or the user side, they can act as independent market subject or join hands with power generation enterprises to participate in market transactions of auxiliary services such as peak and frequency regulation. (This point was not explicitly mentioned in the draft for comment in March)

In addition, the notice also made it clear that for power storage facilities built at the power generation side, "discharge capacity is equal to the power generation capacity of the power plant, and shall be settled according to the contract price of the power plant". This provision provides a clear legal basis for wind power plants and photovoltaic power stations to configure energy storage facilities to improve power limit. For the power storage facilities built on the user side, "charging power can be used to implement catalog price, or participate in direct power transaction to buy low-valley power by oneself, discharge power can be used by oneself, or it can be regarded as the distributed power supply to be sold to power users nearby". In addition to being used for peak-valley price difference arbitrage within enterprises, user-side energy storage has more commercial application modes to improve utilization rate and reduce investment payback period.

2. The introduction of the policy in the context of "electricity reform" confirms the view repeatedly raised by us that "the improvement of the degree of power marketization will open up a huge energy storage market":

According to the experience of overseas countries, the higher the degree of power marketization, the more business models of energy storage facilities and the larger the potential market will be. The "notice" within the energy bureau for advice is less than 3 months is the official launch, on the one hand, reflects the change electric propulsion rate than expected, on the other hand also confirms we have been emphasized point: electric change and energy in our country Internet sparked by the advance of the construction of the "new" investment demand, there will be a large percentage fall on the construction of electric energy storage facilities.

3. Optimistic about the explosive growth of lead-carbon battery and lithium battery energy storage system in the market of power auxiliary services:

In the optional electric energy storage technology of the route, we are most bullish on the lowest cost of lead carbon battery energy storage, unit investment 1200yuan/kWh and the degree of charging and discharging of 0.5yuan/kWh electricity costs make it in many applications don't use any subsidy to profitability. To industrial and commercial users simply used for electricity price arbitrage is calculated, when the peak valley price difference is more than 0.8yuan/kWh, not leveraged investment payback period can be as low as 5 years. The payback period is shorter if the savings in capacity charges and the additional benefits of participating in ancillary power services such as demand response are taken into account.

Li-ion battery energy storage despite the cost is significantly higher than lead carbon. But because of the advantages of high energy density and high rate charge and discharge capacity, in some applications, such as need high rate charge and discharge levels "seconds/minutes FM services" or more sensitive to equipment covers an area of commercial/residential energy storage market, still has irreplaceable advantages.

In addition, such as liquid flow battery, compressed air and other electric energy storage technology, due to the cost or technology maturity may not be able to achieve large-scale commercial application in a long time.

Investment advice

Since the beginning of this year, we have continued to focus on the theme of energy storage. The accelerated implementation of commercial projects has demonstrated strong demonstration effect + accelerated electricity reform has stimulated potential energy storage application demand + the 13th five-year energy plan and other policies have been introduced as catalysts, which is the core recommendation logic of this year's energy storage sector different from that of last year.

Continue to focus on the recommendation of lead-carbon battery energy storage tap: nandu power supply, shengyang shares, lithium battery energy storage tap: sunshine power supply, system integration tap: kelu electronics, attention: mengshi technology, xiongtao shares, rainbow refinement.

The page contains the contents of the machine translation.