Domestic large-scale energy storage: As of this week, the bidding volume for energy storage projects in August has reached 57.8% and 69.1% of the totals in July. The average price for energy storage systems in August is 1.37 yuan/Wh, with prices ranging between 0.92 and 2.33 yuan/Wh. The majority of prices fall within the range of 1.2 to 1.5 yuan/Wh. In July 2023, the overall average price for energy storage systems was 0.95 yuan/Wh, marking a 15.8% decrease from the preceding month. During this period, price fluctuations ranged from 1.09 to 3.275 yuan/Wh, with the most common prices falling between 1.18 and 1.4 yuan/Wh.
In July 2023, the cumulative bid size for energy storage system EPC reached approximately 2.63GW/5.96GWh, marking a substantial 83.1% and 114.5% increase compared to the same period last year. Moreover, on a monthly basis, these figures surged by 69.93% and 74.78%. The combined victorious capacity of energy storage system EPC projects for the period spanning January to July soared to 13.6GW/32.2GWh, showcasing an impressive 153.7% and 199.8% year-on-year surge. Among these statistics, the energy storage system bidding capacity in July alone reached around 2.02GW/4.73GWh, reflecting a remarkable year-on-year escalation of 339.36% and 366.69%, and a solid month-on-month growth of 79.45% and 86.95%. Conversely, the total EPC bidding scale for ESS in the same month was about 0.62GW/1.23GWh, indicating a year-on-year decline of 37.18% and 30.31%, but an impressive month-on-month uptick of 44.71% and 39.77%.
Based on the specific usage scenarios (excluding projects with unclear applications), the entirety of the winning capacity resides within the grid sector, encompassing the entire capacity share. Looking ahead, as the advancement of new power system construction gains momentum, the domestic landscape for large-scale energy storage exhibits a promising trajectory. This positive trend extends to the profitability model, which is set to become more seamless over the long run. Industrial and commercial energy storage, buoyed by reduced lithium carbonate prices and the expansion of peak-valley price differentials, experiences an enhanced economic outlook.
The latter part of the year is poised to witness the installation peak for ground-based photovoltaic power plants. Forecasts indicate a monthly surge in the bidding capacity within the domestic large-scale energy storage market. In the first quarter of this year, the rapid drop in lithium carbonate prices led to a slowdown in demand within the domestic large-scale storage sector. Most downstream manufacturers adopted a cautious stance, resulting in a low order completion rate. According to industry feedback, January exhibited a positive demand for energy storage batteries, but this enthusiasm waned gradually since early February. Moreover, downstream customers commenced seeking reasons to postpone pickups, citing factors such as incomplete plant construction. Following the stabilization of lithium carbonate prices during the second quarter, the domestic large-scale energy storage market experienced a rapid upswing. From late April onward, the implementation of energy storage bidding capacity accelerated.
Anticipating the forthcoming peak in ground-based photovoltaic power plant installations during the latter half of the year, we expect a month-on-month upswing in the bidding capacity for large-scale energy storage. Nonetheless, industry research feedback hints at heightened competition within the domestic large-scale energy storage bidding market this year.
European residential energy: As of August 18th, 2023, the spot price for electricity in Germany reached €84.79/MWh, displaying a remarkable 47.25% weekly surge in the average price. Meanwhile, the futures price for German electricity stood at €141.08/MWh, marking a 3.76% average weekly increase. In the Netherlands, the spot price for natural gas hit €34.35/MWh, with a weekly average rise of 4.42%, while the futures price for Dutch natural gas reached €54.91/MWh, showing a weekly average improvement of 6.09%.
This week, European electricity and gas prices have experienced an upward trajectory, largely due to concerns surrounding heightened summer demand in the market. In the short term, it's expected that European gas and electricity prices will continue to exhibit fluctuations while maintaining a relatively low level.
New energy storage installations in Germany totaled 325MWh in July 2023, comprising 6.74MWh for large-scale storage, 6.8MWh for industrial and commercial storage, and a significant 310MWh for household storage. The cumulative installed energy storage capacity for Germany from January to July 2023 reached 8.86GWh, marking an impressive 96.2% year-on-year growth. Within this, large-scale storage accounted for 1.3GWh, industrial and commercial storage stood at 0.36GWh, and household storage reached 7.2GWh, showcasing respective year-on-year growth rates of 86.8%, 60.2%, and an impressive 100%.
As of now, the inventory level for household storage distribution channels in Europe has shown notable improvement. However, our research indicates that new orders for household storage still remain subdued. We project a gradual uptick in new orders throughout the latter half of the year. Additionally, considering the relaxation of tensions in the Russian-Ukrainian conflict and the gradual shift in policies across Europe, the growth rate of installed capacity for household storage in Europe during 2023 is anticipated to slow down compared to 2022. Nevertheless, it's expected to maintain a robust year-on-year growth rate.
U.S. Energy Storage: During the first quarter of 2023, the newly installed capacity for energy storage in the United States amounted to 0.78GW/2.145GWh, signifying a year-on-year decline of 11.3% and 22%, as well as a quarter-on-quarter decrease of 27% and 29%. Among these figures, the Front-of-the-Meter (FTM) sector continues to be the primary driver of new energy storage implementations in the U.S., constituting a substantial 70.5% and 72.3%. In the same quarter of 2023, the installed capacity within the FTM market reached 0.55GW/1.55GWh, marking a notable year-on-year drop of 25.8% and 35.3%, along with a quarter-on-quarter decline of 34.8% and 38.1%. This downturn is primarily attributed to the repercussions of supply chain disruptions and constraints related to grid connections. Moreover, over 1.8GW of energy storage project capacity planned for installation during Q1 was postponed. Notably, California and Texas accounted for 84% of the new installations within the FTM market.
U.S. Household Storage Market: During the first quarter of 2023, the newly installed capacity within the U.S. household storage market reached 155MW/388MWh, demonstrating a year-on-year rise of 7.1% and 16.2%, albeit with a quarter-on-quarter dip of 9.1% and 9.3%. This marked the first instance of a quarter-on-quarter decline in nearly two years, ending a streak of six consecutive quarters of growth. In the same quarter of 2023, the fresh installed capacity in the U.S. commercial and industrial market achieved 69MW/203MWh, signifying a year-on-year surge of 9.7% and 43%, coupled with a robust quarter-on-quarter increase of 44% and a striking 111.8%. Notably, this sector rebounded after experiencing four consecutive quarters of below-average installation levels. The upturn in commercial and industrial energy storage in Q1 2023 was predominantly attributed to the execution of grid-connection projects that had been deferred from the previous period.
