As demand for clean energy sources rises, there is a growing consensus among industry experts that energy storage will play a crucial role in driving green transition in China.
Energy storage systems, such as advanced batteries, pumped hydro storage and compressed air energy storage, will play a key role in maintaining a stable energy supply from various renewable sources, said Ye Xiaoning, a senior engineer from the State Grid Energy Research Institute's new energy department.
The technology is crucial for capturing excess energy during peak production times and releasing it during periods of low production, guaranteeing a consistent and reliable power flow, he said during the release of a report on China's new energy generation in Beijing last week.
The report contends that China's new energy generation capacity has grown rapidly in recent years and has slowly became the leading source of newly added generation capacity.
At the end of 2022, the national cumulative installed capacity of renewable energy reached 700 million kilowatts, and electricity generation reached 1 trillion kilowatt-hours for the first time last year. The total utilization rate of new energy has remained consistently at 95 percent for five consecutive years since 2018, equivalent to the levels in developed countries like Germany.
The construction of new energy grid integration and transmission projects also increased, leading to the enhancement of the capacity for optimal allocation of new energy resources on a large scale, the report said.
The energy storage will serve as a pivotal and essential technology to support the green transition of power systems in the nation, it said.
Shi Zhiyong, a senior engineer at the State Grid Energy Research Institute, provides energy storage services for power system operations, such as peak shaving, frequency regulation, and reserve capacity.
It has proven to significantly enhance the utilization of renewable energy sources like wind and solar power while supporting distributed power generation and micro-grids, which is a key technology that facilitates the transition from fossil fuels to renewable energy sources, he said.
Shi notes that the current energy storage landscape encompasses diverse technologies, such as battery storage, pumped hydro-electric storage, and compressed air energy storage, each with its unique tech-economic characteristics.
This multiplicity of options will likely persist in the short term, he said.
For example, battery technologies are recognized for their rapid response and modularity, which makes them perfect for applications requiring quick changes. The report found that pumped hydro storage excels in providing large-scale, long-duration storage, ideal for seasonal energy imbalances.
The institute recommends that policymakers and investors consider not only the current state of technology but also anticipate future trends, advancements and integration prospects, while laying out the blueprint for the country's energy storage market, to ensure that selected energy storage solutions meet both the technical demands and the economic considerations of the rapidly changing energy sector.
Lin Boqiang, the head of the China Institute for Studies in Energy Policy at China's Xiamen University, agreed by saying that diverse technologies not only encourage innovation, but also lower costs.
As technological advancements continue to emerge, prices are expected to decrease, with improved efficiency and an improved overall performance of energy storage systems, he said.
As the development of China's electricity spot market is still in its pilot phase, the scale of new energy storage facilities is too small to participate in the medium-to-long-term market and spot market, the institute said.
While new energy storage facilities only participate in the peak-shaving ancillary services market and the frequency regulation ancillary services market for now, it is expected that further integration and participation of energy storage in various market sectors will occur, as market infrastructure matures and new energy storage technologies evolve.