The electrochemical energy storage system industry chain mainly includes upstream equipment manufacturers, midstream system integration and installation, and downstream application scenarios.
The competition in power conversion systems (PCS), battery management systems (BMS), and energy management systems (EMS) is mainly reflected in conversion efficiency, battery management, grid interaction, etc., which will reflect long-term competitiveness and is expected to incubate fine-grained sub-market. At the current stage, the value of the battery part is the highest, which belongs to the core link of the energy storage industry chain; the cost of the PCS part is not high but the importance is relatively high, and there are certain barriers. Most of the main participating companies are photovoltaic inverter companies, and the competition pattern is stable. PCS's unit value and unit profit are higher than those of photovoltaic inverters; the software part BMS and EMS are still in their infancy, but they have the characteristics of high gross profit. In the long run, EMS's ability to manage energy consumption and BMS's management of battery health capability is the key to distinguishing the advantages and disadvantages of energy storage systems. It will reflect long-term competitiveness and is expected to incubate market segments.
At present, energy storage system integrators who have the right to speak in channels and core components will have a certain advantage, but future competition is not limited to hardware integration capabilities but also lies in the software level and long-term operational capabilities. Integrators, as the segment with the fastest volume, receive the most attention in the midstream. Integrators who have the right to speak about core components have strong profitability at this stage; integrators who are beginning to show economies of scale and have channel advantages are conducive to seizing a higher market share. As the energy storage industry is still in a period of rapid development, relevant markets and policies are still being opened up, and the competitive landscape is far from certain. In the future, the core barriers for integrators lie not only in hardware integration, but also in software algorithms, interaction with power grids, and understanding of downstream applications.
the user side already has investment value at present and has a broad market prospect; the power generation side and grid side will also have corresponding investment value in the future with the guidance of policies and the enrichment of business models. In the near future, investment should focus on user-side energy storage, because it has the highest economic value and rich business models at this stage. In the short term, the widening of the peak-to-valley electricity price difference has made distributed energy storage a good investment value. At present, the investment entities of user-side energy storage also tend to be diversified. State-owned enterprises, private enterprises, industrial and commercial owners, local energy funds, foreign trade logistics real estate funds, etc. have all begun to try to invest in user-side energy storage projects. In the future, with the continuous improvement and maturity of the electricity market trading mechanism, it is expected to bring greater profit space. The energy storage volume on the power generation side is relatively large, and the driving factor is mainly the policy requirements for new energy power generation and storage. On the power generation side, large-scale projects costing hundreds of millions of dollars are more preferred to be led by large listed companies, with high entry barriers, low gross profit levels, and low investment returns at this stage. Grid-side energy storage has higher technical barriers, which may bring higher profit levels. Grid-side energy storage has not incorporated energy storage costs into power transmission and distribution prices, and investment has stagnated recently. In the future, when the ancillary service market matures, it will have higher returns. However, independent energy storage companies also need to consider how to cooperate with grid companies.