China witnesses significant energy storage market growth


The paper, Energy Storage Industry 2017 Summary, is the organization’s sixth edition analysing the Asian country’s energy storage market since 2010.

The report highlights energy storage projects, policies and technologies introduced and implemented in China in 2016.

According to CNESA, the report helps stakeholders in the Chinese energy storage sector to improve their understanding of the market for the development of new frameworks which can be used to boost the market.

The summary analyses investments made in the sector and the benefits of an increase in energy storage adoption to the Chinese energy market and the economy as a whole.

According to the findings of the study, the Chinese energy storage market grew to reach an annual growth rate of 86% in 2016 as stakeholders in the energy sector realised the commercial value energy storage has within their operations.

In 2016, a total of 24.3GW of energy storage capacity has been registered, marking an increase of 4.7% from the previous year.

The renewable energy-grid integration segment accounted for 55% of all energy storage projects deployed in 2016 with the connection of distributed energy resources with grid networks being the fastest growing sector amongst other sectors.

The majority of energy storage projects were deployed in the Chinese northeast, central, south central, northwest and southwest regions.

The northwest region led other regions in deploying renewable grid integration projects as 99% of energy storage programmes implemented in the region connected renewable energy resources with the main grid.

Other regions focused on the use of energy storage to expand portfolios of distributed energy generation and microgrids.

The market was mainly dominated by local companies as the majority of energy storage manufacturers in the top ten most active companies are Chinese owned.

Energy storage market and policy development

A major contributor to sector growth is the increase in support from national regulatory authorities through the drafting of new policies paving way for an increase in investments towards research, development and implementation of existing and new energy storage technologies.

Energy storage has been approved as the key towards China stabilising its grid network through balancing traditional power generators, increasing integration of renewable energy resources with grid systems and expanding the portfolio of distributed energy resources, says CNESA.

For instance, energy storage has been included in the National Demonstration Power Project Management Measures, meaning energy storage projects will be promoted at a national level and prioritised in the planning of the country’s energy industry.

The report states that last year energy storage technologies were successful in exploring applications in user-side peak pricing arbitrage, grid-side capacity pricing trials, local microgrids and in generation-side flexibility resource subsidy mechanisms.

Energy storage has helped in avoiding blackouts through the filling of power supply gaps and peak and frequency regulation.

The electric vehicle market also rose in 2016 due to advancements in the development of lithium-ion energy storage batteries. CNESA predicts lithium-ion batteries to become the backbone of the energy storage market throughout 2017.

Although the government through the 13th Five-year plan introduced a number policies supporting the growth of the market, lack of specific policies still hinders the market in reaching its full potential.

The organisation recommends the introduction of strong demand response energy tariffs to improve consumer energy efficiency and optimise the operations of energy storage systems.

“Consumers are comfortable with stable and cheap power from the grid, leading them to ignore meager benefits from clean energy and energy storage systems. Strong price signals are still absent,” states the whitepaper. [IRENA and China’s State Grid sign clean energy agreement].

In addition, there is still need for the development of mechanisms to strengthen standards for energy storage systems and to improve the designing and planning of energy storage projects.


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