In the first quarter of 2026, global energy storage system shipments reached 100.0 GWh, a 96.5% increase from 50.9 GWh in the same period of 2025, bringing quarterly shipments to an entirely new scale. The industry's competitive landscape has undergone fundamental changes. In Q1 2026, Chinese companies shipped 82.2 GWh globally, with their global share jumping from 62.7% in Q1 2025 to 82.2%, a gain of 19.5 percentage points. Overseas integrators saw their shipments fall from 19.0 GWh to 17.8 GWh, and their share contracted from 37.3% to 17.8%. Chinese companies are no longer limited to the equipment supply stage; they have widely entered the system integration space in Europe, Asia-Pacific, the Middle East & Africa, competing head‑on with established overseas integrators. The clear trend is that industry influence is concentrating in Chinese hands.
Domestic market shipments in Q1 reached 37.4 GWh, accounting for 37.4% of global shipments, only a slight increase from 35.8% in Q1 2025. The lack of a dramatic jump in the domestic share is mainly attributable to three reasons. First, the order book delivered in Q1 was dominated by projects signed in 2025 or earlier; a large number of projects had already been grid-connected and delivered by the end of Q4 2025, so Q1 entered a seasonal lull, with clear seasonal mismatch. Second, in Q1, battery cell companies already faced the first round of rising raw material prices. Spot lithium carbonate prices rebounded strongly from their trough in Q4 2025, and mainstream 314Ah LFP cell prices rose from RMB 0.26-0.31/Wh at the end of 2025 to RMB 0.35/Wh. Facing a sharp upward move in raw materials, domestic cell manufacturers accelerated efforts to establish price linkage mechanisms with downstream integrators and project owners, using the lithium carbonate price as a benchmark for adjustment formulas. However, price transmission takes time, causing some delays in delivery schedules. Third, overseas projects offer higher margins; the internal rates of return for overseas projects are generally higher than for domestic ones. Given tight production capacity, domestic cell and integration companies have a clear strategic preference to prioritize deliveries to high‑margin overseas clients. Meanwhile, domestic project owners tend to wait and watch for better pricing windows. Multiple factors together mean that the peak delivery season for domestic cells and integrated systems has historically been concentrated in the second half of the year, leaving the domestic share in Q1 relatively low.
The European market saw explosive growth in Q1, with regional shipments surging from 4.3 GWh in Q1 2025 to 22.4 GWh, a year‑on‑year increase of 421%, and its global share climbing from 8.4% to 22.4%, a gain of 14.0 percentage points. European utility‑scale storage shipments are transitioning from primarily hundred‑MWh projects to GWh‑scale projects. Co‑located storage is being deployed faster in markets such as Germany, the UK, and Bulgaria. Among emerging European markets, the Netherlands stands out: the elimination of net metering policies is forcing existing PV users to add storage, and negative power prices exceeded 500 hours in 2025, significantly improving the economics of storage deployment. Bulgaria, with strong subsidy policies, a solid project pipeline, and attractive project economics, is now ranked alongside Germany and the UK as one of the most attractive co‑location investment markets; co‑located PV capacity there already accounts for over 40% of the country's total PV installations. Residential storage also contributed better‑than‑expected incremental volumes. Ongoing geopolitical tensions continue to drive strong end‑user demand for electricity autonomy, and with electricity prices remaining high, household storage purchasing demand has been released intensively. The UK market saw a concentrated policy benefit in Q1: from 2026, new buildings must install PV, and the "Warm Homes Plan" provides £15 billion to support the development of PV, storage, and heat pumps. At the utility scale, the impact of the export tax rebate adjustment is relatively limited – the rebate rate for utility‑scale storage exports was already low, and the incremental tax burden at the cell and system level accounts for a small share of total cost. Therefore, the rebate adjustment did not materially dampen European utility‑scale storage demand. Most critically, project returns in Europe widened significantly in Q1, driven by two main dimensions: first, intra‑day power price spreads widened further, with more frequent negative price periods creating greater arbitrage opportunities for storage; the revenue structure for European storage has upgraded from simple arbitrage to a "arbitrage + ancillary services + capacity contract" model, fundamentally changing the payback logic. Second, ancillary service revenues also increased – in mature markets like the UK, tradable ancillary services such as frequency response and reserve capacity have become more systematic. The substantial improvement in economics has become the fundamental driver behind developers' willingness to place orders.
Emerging markets, led by India, maintained a strong incremental trend in Q1. Shipments in the Asia‑Pacific region increased from 2.8 GWh in Q1 2025 to 6.2 GWh, a 121% increase; shipments in the Middle East & Africa region rose from 2.8 GWh to 11.9 GWh, a 325% increase. Together, these two regions increased their global share from 11.0% to 18.1%. Large‑scale solar‑storage hybrid projects and grid distribution upgrade projects in India entered the equipment procurement window, and Chinese companies – with their cost advantage in cells and DC side systems – dominate that market. In the Middle East, Saudi Arabia has launched a 37 GWh battery storage system project, and the UAE has launched a 28 GWh project; together, these represent over 65 GWh of incremental capacity moving into the execution phase. In terms of actual Q1 shipment pace, Chinese companies had already concentrated a large batch of equipment shipments in January and February, effectively supporting the Q1 shipment figures for the Middle East & Africa region. After late February, with a sharp escalation of geopolitical tensions in the Middle East, navigation through the Strait of Hormuz was disrupted. Most global shipping lines suspended high‑risk routes or rerouted, raising logistics costs by 30‑50%. Some leading integrators faced requests from Middle Eastern general contractors to reduce orders or delay deliveries, raising the risk of extended project cycles. However, Q1 shipments had already been dispatched before these disruptions, so the short‑term impact was not yet fully reflected in the quarterly data.
The Australian market showed clear policy‑driven incremental signals in Q1. The Australian government increased its "Cheaper Home Battery Plan" budget from A2.3billiontoA2.3billiontoA7.2 billion and introduced a capacity‑tiered subsidy scheme effective 1 May 2026: full subsidy for 0‑14 kWh, 60% subsidy for the 14‑28 kWh portion, and 15% subsidy for the 28‑50 kWh portion. During the policy transition, large‑capacity residential storage systems (up to 50 kWh) saw a rush of installations before 1 May, providing clear support for Australian shipments in Q1 and early Q2. Australia's residential storage installations are expected to reach 8 GWh in 2026.
Looking ahead, the pace of global energy storage shipments will be shaped by multiple interacting variables. In the domestic Chinese market, even though raw material prices remain elevated and volatile, and market discussions about negative feedback effects are increasing, the price transmission from cells to integrators to project owners involves a significant time lag. Moreover, cell manufacturers generally hold more than one and a half months of raw material inventory. Therefore, domestic cell and system shipments are still expected to accelerate in the second half of the year, with the annual shipment peak likely occurring in Q3 and Q4. Nonetheless, the cumulative effect of negative feedback warrants close attention. For Europe, a solid pipeline of incremental projects and continuously improving project returns provide a firm floor for shipments. Demand in Q2 is expected to remain strong. European co‑located storage projects will enter a more intensive delivery phase, policy‑driven incremental demand from emerging markets such as the Netherlands will be further unlocked, and the residential storage market is expected to return to sustained growth amid high electricity prices and gradually stabilising cost structures. In Australia, after the subsidy rule change on 1 May, there may be a brief adjustment period, but with strong policy support, annual installations will maintain high growth; at the same time, utility‑scale storage projects will enter a concentrated release phase. The U.S. market, constrained by interest rates and trade barriers, has seen a marked slowdown in growth, but Q1 was a traditionally weak season, and Q2 shipments are expected to rise sequentially. In the Middle East, shipping and project delivery are currently maintaining normal pace; equipment already dispatched will gradually complete installation recognition, and shipment data is expected to be concentrated in Q2 and Q3. The overall momentum in emerging markets remains ample, with rigid demand continuing to be released in India, the Middle East & Africa, and other regions. Based on the Q1 base of 100.0 GWh, and assuming no extreme variables emerge in the subsequent market, global energy storage shipments in 2026 are likely to exceed 440 GWh. As the market expands in scale, it will also enter a phase of all‑dimensional competition in terms of local delivery capability, system performance, and whole‑lifecycle returns.
The structural changes in the European energy storage market are reshaping the logic of China‑Europe industrial chain cooperation. Focusing on core issues such as the realities of European project development, system pricing transmission, and Chinese supply chain collaboration, SMM will host the 2026 SMM Germany Solar & Energy Storage Forum on the afternoon of June 23, 2026 in Munich, held concurrently with Intersolar Europe & ESS Europe. The forum will bring together leading European and Chinese developers and industry institutions, including RES Group, Great Power, Verkor, Farasis, Greenvolt Power, AKU-BAT CZ, GCL, and Gaojing, alongside representatives from the Chinese industrial chain to explore practical pathways for China‑Europe energy storage cooperation.
Detailed agenda: 2026 SMM Germany Solar & Energy Storage Forum_Metals Market
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