2017-2018 Power Battery and Energy Storage Battery Research Report

Recently, Dongfang Securities released a report on the battery industry, which pointed out that driven by the electric vehicle and energy storage industries, the demand for batteries will maintain a rapid growth rate of over 25% in the next decade. With the increasing penetration rate of electric vehicles and the gradual opening of the energy storage market, there is still tens of times more room for growth in power batteries in the future. The detailed content is as follows:

Due to the withdrawal of government subsidies after 2020, there are doubts in the market about the penetration rate of new energy vehicles and the demand for power batteries. As the cost of lithium batteries continues to decline, the cost-effectiveness advantage of new energy vehicles as consumer goods will gradually be reflected, and the penetration rate will continue to increase. In addition, the energy storage industry is about to break through, and the demand for power batteries will maintain a high compound growth rate of over 25% in the next decade.

Driven by the demand for electrification and energy storage in automobiles, the shipment volume of power and energy storage batteries reached 73GWh in 2017, accounting for more than half of the shipments of lithium-ion batteries. Currently, it is still in the early stages of electrification, with electric vehicle sales accounting for just over 1%. With the increase of electric vehicle penetration rate and the gradual opening of the energy storage market, there is still tens of times more growth space for power batteries in the future.

The cost-effectiveness ratio between electric vehicles and traditional fuel vehicles is the core factor determining the process of car electrification. Currently, the purchase cost and total cost of use (TCO) of electric vehicles are still higher than that of fuel vehicles, so the industry is in a subsidy driven stage. As battery costs continue to decrease, electric vehicles will gradually enter the stage of TCO parity and purchase cost parity. At the same time, policies in various countries have increasingly strict environmental requirements for fuel vehicles, which will force traditional car companies to increase the production and sales of electric vehicles. The penetration rate of electric vehicles is expected to rapidly increase. The internal reason for the driving force switching in the power battery industry is the rapid decrease in costs, the continuous enhancement of electric vehicle cost competitiveness, and the external reason is the adjustment of industrial policies.

The application space of lithium batteries in the energy storage market is gradually opening up as their costs decrease. Energy storage can play various important roles in the power system, including peak shaving and frequency regulation, backup power supply, peak shaving and valley filling, etc. It is expected that the global composite growth rate will reach over 40% in the next decade. The further reduction of energy storage costs depends on the improvement of battery cycling performance, and large-scale energy storage requires extremely high safety requirements for batteries. Therefore, this segmented market will also focus on leading enterprises.

Automobile electrification is the main source of demand for power batteries

In 2017, the global sales of new energy vehicles exceeded 1.223 million units, an increase of 58% compared to 2016, driving the proportion of global new energy vehicle sales in total global car sales to exceed 1% for the first time. Since 2012, the production and sales of new energy vehicles at home and abroad have continued to grow rapidly, with a compound growth rate of 54% in the past five years. As of the end of 2017, the cumulative global sales of new energy vehicles had reached nearly 4 million, accounting for 0.3% of the global car ownership. Among them, China’s cumulative sales of new energy vehicles exceeded 1.6 million, accounting for 42% of the global total. In addition to China, the main markets also include the United States, Japan, Norway, Germany and other European countries, and the top ten consumer countries accounted for 93% of the global total cumulative sales.