The lithium energy storage tuyere will attract attention to Nandu Power supply: the power generation side will welcome the harvest time.

SMM News: benefit from the policy, the domestic energy storage market is expected to fully open. The Citic Energy Storage Index (C1005477.WI) has been rising since June this year and is still at a phased high. Key issues such as the future direction of the market and which company is expected to fully benefit have also gained a lot of attention in the capital markets.

A reporter from the Financial Associated Press recently arrived at the headquarters of 300068.SZ, the target of energy storage in Hangzhou. Zhu Baoyi, general manager of the company, said that in the past two years, the overseas energy storage market has grown rapidly, generating a lot of demand for the company's lithium energy storage system. The company has undertaken mainstream projects in the United States, Europe and Southeast Asia. At the same time, it has a large number of project reserves, and business growth is expected. On the other hand, although the energy storage business accounts for a small proportion of the company's current revenue, benefiting from the policy promotion, the market space of the power generation side energy storage business is gradually opening up, and the energy storage business will be an important focus of the company in the next 1-2 years.

Energy storage business is expected to scale up.

Since 2019, many provinces across the country have issued documents requiring new energy enterprises to configure energy storage. In May and August this year, the National Development and Reform Commission and the National Energy Administration jointly issued "guidance on establishing and improving a long-term Mechanism for Clean Energy consumption (draft for soliciting opinions)" and "Integration of scenery, Water, Fire and Storage" and "Integration of Source, Network, charge and Storage", which was interpreted as a prelude to standard energy storage for new power stations.

It is reported that energy storage can be further divided into power generation side, Electroweb side and user side, as well as rechargeable pile energy storage and other market segments. Among them, the generation side is the most important incremental market, with clear policy support; Electroweb side is long-term demand, but there is no obvious flashpoint; on the user side, the market space shrinks due to the reduction of peak-valley price difference; charging piles are still in the early stage of development.

Zhu Baoyi said that the company has been ploughing the domestic and foreign markets for many years, and the cumulative installed scale of energy storage is 1000MWh. it has been in the forefront of the industry, but it has been restricted by the difficulty of opening the domestic power generation market. After the release of the relevant policies this year, the activity of the domestic energy storage market has increased significantly, superimposed by the high prosperity of the foreign energy storage market, and it is expected that the business will be able to expand on a large scale next year.

At present, the domestic power generation side energy storage market shows a competitive situation: participants can be divided into Nandu Power, Ningde Times (300750.SZ), Guoxuan Hi-Tech (002074.SZ) and other manufacturers focusing on system delivery, as well as Sunshine Power (300274.SZ), 688390.SH (688390.SH) and other major inverter manufacturers, all have strong strength, but it is difficult to say who has the absolute advantage.

In Zhu Baoyi's view, compared with some of his peers, the company's own advantage is that the inverter, EPC, cell and other key components are all independently developed and have the ability to deliver the system, and the company has been laying out since 2011, and compared with its domestic counterparts, it has richer project experience at home and abroad, and the product performance and project operation capability have been tested.

Under the policy guidance, the industry expects the market demand for energy storage to be sharply enlarged. The recent analysis report of the British University Securities Research Institute estimates that the energy storage demand will reach 16GWh, 48GWh and 96GWh respectively in the next five years without considering the allocation of the new energy base, assuming that the permeability reaches 10%, 30% and 60% respectively.

However, in an interview with the Financial Associated Press, some brokerage researchers also warned that although the energy storage market is on the eve of the outbreak, there are still certain risks: although the cost of lithium energy storage has been greatly reduced, it is still unable to meet the requirements of the rate of return of the project. it is still a burden on the cost side; in addition, for the power generation side energy storage business, the future speed of policy is still uncertain.

The pattern of competition among heroes and heroes is beginning to show.

At present, energy storage business accounts for a low proportion of the total revenue of listed companies, and the market competition pattern has not yet been fully formed. According to the 2020 semi-annual report, Nandu Power's energy storage business has a revenue of 219 million yuan, accounting for 5.32% of the total revenue. In the same period, Ningde era energy storage business revenue of 567 million yuan, accounting for 3.01%; sunshine power supply energy storage business revenue of 250 million yuan, accounting for 3.61%.

Considering that there may be a gap in the statistical caliber of accounting subjects among different companies, it is difficult to directly compare the scale of energy storage business, but it is certain that each energy storage business accounts for a small proportion, which also leaves plenty of room for imagination for which company can fully benefit from the explosion of energy storage on the generation side.

Western Securities believes that among the major energy storage stocks, the advantage of the Ningde era lies in the capacity and technology of lithium batteries. Nandu Power mainly focuses on the fact that the company has been ploughing the energy storage industry for many years and has rich experience in project operation at home and abroad.

Among other companies in the industry, Yiwei LiNeng and Guoxuan Hi-Tech are in the active layout stage, have completed the delivery of foreign energy storage projects one after another, and accumulated some project operation experience. Among the two inverter manufacturers, Sunshine Power and Gu Dewei, the former has fully transformed to the role of energy storage system service provider, but the core advantage still lies in the inverter and overseas channels, while the latter is still focusing on inverter products.

The above-mentioned securities researcher said that from the point of view of cost and product competitiveness, compared with inverters, lithium battery manufacturers will have more space. However, if it corresponds to individual stocks, we need to further consider the elasticity of individual stocks, that is, the pulling effect of energy storage on the overall performance and valuation.