Driven by policies, the newly installed capacity of energy storage in China increased rapidly during the 14th Five-Year Plan period

Driven by national policies, China's energy storage market experienced rapid development during the 14th Five-Year Plan period. In 2023, China's newly installed capacity reached 47 GWh, up 183% YoY.

In terms of market structure, grid-side energy storage still dominated, with new installed capacity accounting for 90% of the total. User-side energy storage also saw robust growth, especially in the industrial and commercial energy storage sector, where the share of new installed capacity reached 10% in 2023.

Regarding types of installed capacity, traditional energy storage technologies, represented by pumped hydro storage, saw their share drop to 60% for the first time in 2023. Meanwhile, new energy storage installations increased. Lithium-ion storage technology, with its well-established industrial chain and lower costs, led the way in commercial applications, accounting for 97% of new energy storage installations in 2023.

Currently, energy storage technologies are flourishing. As the share of wind and solar power in China's installed capacity continues to rise, the issue of long-term power imbalance is becoming a major challenge for the new power system. In the future, as the share of renewable energy increases, the necessity and urgency of building long-duration energy storage systems (over 4 hours) will grow. Technologies such as compressed air and flow batteries are expected to see large-scale development in the future.