314Ah Battery Cells Are Highly Sought After, China Sets Ambitious Goal to Double New-Type Energy Storage Installations by 2027

An unexpected wave of energy storage orders is sweeping the industry. The sudden shift in the supply-demand relationship has led to soaring orders across the industry chain, with production lines operating at full capacity still unable to meet demand, marking the beginning of a market-driven industry test.

Domestically, this surge is closely tied to a key policy adjustment period. The "Document No. 136" jointly issued by the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA) explicitly states that energy storage allocation must not be a prerequisite for the approval, grid connection, or grid access of new energy projects. This regulation took effect on June 1, marking the end of the multi-year mandatory energy storage allocation policy. To safeguard expected yields, some enterprises engaged in an installation rush before the "May 31 deadline."

According to industry statistics, in the first half of this year, China’s new-type energy storage that was newly put into operation exceeded 56 GWh, up 68% YoY. Influenced by the policy deadline, May saw record-high new installations. This policy-driven "last-minute rush" has further fueled the already booming energy storage industry.

NDRC and NEA Set New Target: New-Type Energy Storage Installations to Double Again by 2027!
On September 12, the NDRC and NEA issued a latest notice: the "Action Plan for Large-Scale Construction of New-Type Energy Storage (2025-2027)" (hereinafter referred to as the "Notice"), outlining the path and goals for China’s new-type energy storage development over the next three years.

The Notice proposes that by 2027, the national new-type energy storage installation scale should exceed 180 GW, expected to drive approximately 250 billion yuan in direct project investment.

According to NEA statistics, as of the first half of 2025, the national new-type energy storage installation scale was 94.91 GW/222 GWh. This means that in the next more than two years, China’s new-type energy storage installation scale needs to nearly double, indicating vast market potential and an accelerated development outlook. In terms of technology routes, the Notice clearly states that lithium-ion battery storage will remain dominant, while also supporting the diversified development of various technology routes to enrich application scenarios. This will be achieved by nurturing a number of pilot projects and creating typical application scenarios.

The content of the Notice comprehensively covers multiple key dimensions including overall objectives, application scenarios, utilization levels, innovative integration, standard systems, and market mechanisms. It outlines 7 major items and 21 specific measures, taking a multi-pronged approach from policy mechanisms to market guarantees, with the aim of systematically promoting high-quality, large-scale development of new-type energy storage. The key focuses are as follows:

Regarding the improvement of market mechanisms, it encourages new-type energy storage to fully participate in the electricity market, promoting "new energy + ESS" as a joint bidding entity, and integrating into the electricity market transactions. At the same time, it will orderly promote the participation of new-type ESS in ancillary service markets such as frequency regulation and reserve, exploring auxiliary service varieties like ramping and inertia, and gradually expanding the scale of participation in ancillary services. Additionally, it will push for the establishment of capacity pricing and reliable capacity compensation mechanisms, improving the market price formation mechanism to reasonably determine ESS charging and discharging prices, thereby enhancing project economics.

In terms of expanding application scenarios, it will promote the reasonable allocation of ESS in new energy bases in deserts, Gobi, and barren areas, constructing system-friendly power stations, and utilizing retired thermal power plant resources to build ESS facilities. Standalone ESS power stations will be deployed at critical periods of the power grid, and grid-forming ESS applications will be promoted in grids with a high proportion of new energy. Meanwhile, it will actively innovate application models such as direct green electricity connection, virtual power plants, smart microgrids, generation-grid-load-storage integration, and vehicle-to-grid interaction.

To enhance dispatch operation levels, it requires the scientific formulation of ESS dispatch rules, optimizing the order of various regulatory resource calls, increasing the proportion of ESS calls, and reducing deep peak shaving of coal power. In regions where the electricity spot market operates continuously, dispatching should follow market outcomes; in non-continuous regions, the call for ESS needs to be scientifically increased to improve the economic and safety aspects of system regulation. In terms of technological innovation and industrial integration, support should be given to conducting key technological breakthroughs and diversified technological development, promoting the application of long duration energy storage (LDES), hybrid energy storage, and other applications, and making arrangements for the reserve of cutting-edge technologies; promote the development of industrial clusters, organize a number of innovative pilot projects, and enhance the international competitiveness of the industry.

In terms of policy and financial support, it is specified that all regions must coordinate the scale and layout of energy storage development and implement an annual reporting mechanism; encourage multiple entities, including private enterprises, to participate in investment, and guide financial institutions to provide credit, interest rate, and insurance support; at the same time, accelerate the improvement of the standard system and advance international standardization efforts.

In fact, since entering September, a number of significant policies have been introduced in succession, continuously injecting momentum into the development of new-type energy storage:

On September 2, the National Development and Reform Commission (NDRC) released the Basic Rules for Medium and Long-term Electricity Markets (Draft for Comment), specifying that standalone ESSs are regarded as power generation enterprises when discharging and as power users when charging, laying a institutional foundation for their market identity;

On September 8, the National Development and Reform Commission (NDRC) and the National Energy Administration jointly issued implementation opinions on the high-quality development of "AI Plus" energy, emphasizing the need to promote the application of AI technology in flexibility resources such as virtual power plants, distributed energy storage, and vehicle-grid interaction, to enhance system intelligent dispatching and safety management and control capabilities.

These policies collectively outline a new development landscape featuring deep integration of energy storage with cutting-edge technologies and continuous improvement of market mechanisms.

"Top-tier" 314Ah Energy Storage Battery Cells Are in Short Supply

While policy blueprints are painting a new landscape, the energy storage market has already witnessed a fervent scenario where "battery cells are in short supply." This year marks the true comprehensive replacement of 280Ah battery cells with 314Ah battery cells. Currently, leading battery producers such as CATL, EVE, REPT Battero, Gotion High-tech, Hithium, and CORNEX New Energy have all signaled "full production" for their battery cells, with production schedules already arranged until the end of this year, and some enterprises even having orders extending into early next year.

Faced with surging demand for energy storage, while leading producers are experiencing tight capacity, some demand has begun to spill over to second- and third-tier battery enterprises. It is understood that currently, the capacity utilization rates of second- and third-tier battery enterprises have also significantly increased, reaching over 65%. Notably, amid surging demand for ESS battery cells and tight capacity, battery cell prices have seen a slight synchronous increase. Industry data show that from June to July this year, mainstream battery cell models such as the 314Ah witnessed a price increase of 10%-20%. Meanwhile, the bottoming out and rebound of lithium carbonate prices provided cost support, driving ESS battery cell prices up from the previous 0.25 yuan/Wh to above 0.27 yuan/Wh.

Additionally, from the perspective of the utility ESS tender market, battery cell prices had been declining steadily, falling from around 0.38 yuan/Wh in early last year to approximately 0.28 yuan/Wh in early this year. Starting from Q2 this year, 314Ah battery cell prices began to rebound. Taking the PetroChina Jichai Power procurement project for 500,000 units of 314Ah battery cells, which opened for bids at the end of August, as an example, CATL and Hithium won the bids at prices of 0.32 yuan/Wh and 0.28 yuan/Wh, respectively.

Overall, the 314Ah ESS battery cell prices have recently stabilized and rebounded, with mainstream prices ranging between 0.26 yuan/Wh and 0.32 yuan/Wh. Due to differences in technical routes, cost control, and market strategies, quotations vary among producers. Top-tier enterprises, leveraging their technological advantages and economies of scale, tend to quote relatively higher prices.

On the other hand, from a technical perspective, the technological iteration of ESS battery cell products has never stalled. The R&D and mass production process of next-generation 500Ah+ battery cells is accelerating. Energy storage systems supported by 500Ah+ battery cells, such as 6+MWh and 7+MWh systems, have become a significant trend in industry evolution.

Recently, Sunwoda announced the official launch of mass production for its 684Ah ESS battery cells. Previously, it was reported that the 684Ah battery cells for Sungrow's PowerTitan 3.0 would be supplied by Sunwoda. Based on this, it can be inferred that the 684Ah battery cells mass-produced at Sunwoda New Energy Co., Ltd. in Deyang are likely intended for Sungrow.

Earlier, EVE, AESC, CATL, and others had already achieved mass production of 500Ah+ battery cells.

Overall, the 314Ah battery cell is currently entering an upward cycle characterized by "rising volume and prices." Driven by both short-term supply-demand tightness and long-term technological iteration, the ESS battery cell industry has entered a critical stage of a new round of competition and upgrading. The ESS industry has also reached a turning point, undergoing a profound transformation from "policy-driven" to "market-driven" and from "scale expansion" to "technology-led."

Please note that this news is sourced from the Chinese content on http://www.cbea.com/djgc/202509/842984.html and translated by SMM.