Core Viewpoint - The lithium battery energy storage sector is experiencing a significant surge driven by policy support, market demand, and rising prices, indicating the onset of a new super cycle in the industry [1][5][24]. Policy Support - The National Development and Reform Commission and the National Energy Administration have issued guidelines to promote renewable energy consumption, aiming for an average of 200GW by 2030, which enhances the profitability of energy storage projects [3]. - Energy storage projects can now earn stable income by providing peak shaving services to the grid, increasing internal rates of return (IRR) from 5%-6% to 8%-10%, with some regions even reaching 12% [3][4]. - The cancellation of mandatory energy storage requirements has led to a 212% year-on-year increase in domestic energy storage bidding volumes [4]. Demand Explosion - The domestic market has seen a doubling of registered energy storage projects to 1125GWh in the first three quarters of 2025, indicating a shift from being an accessory to renewable energy to a primary focus [6]. - Overseas orders for Chinese energy storage companies surged by 246% year-on-year, with significant demand from the U.S. and Europe due to AI data centers and carbon neutrality goals [6][7]. Price Increases in Materials - The price of lithium hexafluorophosphate (6F) has increased by 50% from its bottom price of 45,000 yuan/ton, driven by rising demand and limited production capacity [16]. - Prices for battery-grade lithium carbonate and other additives have also seen significant increases, with VC prices rising by 50% since September [12][17]. - The supply-demand dynamics in the materials sector are expected to continue driving price increases, with structural shortages in key components like cathodes and separators [19][23]. Key Companies and Investment Opportunities - Companies involved in energy storage systems and power conversion systems (PCS) are positioned to benefit from the surge in global orders, with notable players including Sungrow Power and Huaneng Renewables [21]. - Leading battery cell manufacturers like CATL and EVE Energy are expected to see stable demand growth, with their production capacities fully utilized [22]. - Material producers such as Tianji and Huasheng Lithium are highlighted for their strong profit potential due to rising prices and demand [23]. Summary - The lithium battery energy storage sector is at the beginning of a super cycle, driven by favorable policies, robust demand, and rising material prices, with significant opportunities across the entire supply chain [24][25].

Core Viewpoint - The lithium battery energy storage sector is experiencing a significant surge, driven by policy support, market demand, and rising prices, indicating the onset of a new super cycle in the industry [1][4][17]. Policy Support - Recent policies from the National Development and Reform Commission and the National Energy Administration promote energy storage projects, allowing them to generate stable income through grid services, enhancing profitability [2][4]. - The internal rate of return (IRR) for energy storage projects has increased from 5%-6% to 8%-10%, with some regions reaching up to 12% due to favorable compensation standards [2][3]. Demand Explosion - The demand for energy storage is surging globally, with domestic projects in China increasing by over 100% year-on-year, and overseas orders for Chinese energy storage companies rising by 246% [5][6]. - AI data centers are emerging as significant customers for energy storage solutions, with large orders being placed to ensure reliable power supply [5][6]. Price Increases in Materials - The prices of key materials such as lithium hexafluorophosphate (6F) and electrolyte additives are rising due to increased demand and supply constraints, with 6F prices increasing by 50% from their previous lows [7][8][9]. - The production of electrolytes has seen a significant increase, with a 43.67% year-on-year growth in the first nine months of the year, indicating strong market demand [6][11]. Key Companies and Segments - Companies involved in energy storage systems and power conversion systems (PCS) are benefiting from the surge in global orders, with notable players like Sungrow Power and Huaneng Renewables leading the market [13][14]. - Leading battery manufacturers such as CATL and EVE Energy are positioned well to capitalize on the growing demand for energy storage cells, with their production capacities fully utilized [15][16]. - Material producers are also set to benefit from price increases, with companies like Tianqi Lithium and Huayou Cobalt expected to see significant profit growth due to their cost advantages and market positions [12][16]. Summary - The lithium battery energy storage sector is at the beginning of a super cycle, driven by strong policy support, robust demand, and rising material prices, with various segments of the industry poised for growth [17][18].

Core Viewpoint - The lithium battery energy storage sector is experiencing a significant surge, driven by policy support, market demand, and price increases, indicating the onset of a new super cycle in the industry [2][7][32] Policy Support - Recent policies from the National Development and Reform Commission and the National Energy Administration aim to meet the average annual demand for 200GW of renewable energy consumption by 2030, enhancing the profitability of energy storage projects [5] - Energy storage projects can now earn stable income by providing peak shaving services to the grid, increasing internal rates of return (IRR) from 5%-6% to 8%-10%, with some regions even reaching 12% [5][6] - The cancellation of mandatory energy storage requirements has led to a 212% year-on-year increase in domestic energy storage bidding volume [6][7] Demand Explosion - The domestic market saw a 100% year-on-year increase in energy storage projects, with 1,125GWh registered in the first three quarters of 2025 [10] - Overseas, Chinese energy storage companies received 163GWh of orders in the first half of 2025, a 246% increase year-on-year, driven by demand from AI data centers and carbon neutrality goals in Europe [10][11] - The combination of domestic, overseas, and data center demand is expected to drive significant growth in energy storage [12] Price Increases in Materials - The price of lithium hexafluorophosphate (6F) has increased by 50% from its bottom, driven by rising demand and low inventory levels [19][20] - Prices for additives like VC and FEC have surged by 50% since September, reflecting a supply-demand imbalance [21][22] - The prices of cathodes and anodes are also rising due to structural shortages, with lithium iron phosphate prices increasing from 70,000-80,000 yuan/ton to 100,000-110,000 yuan/ton [23] Key Companies and Investment Opportunities - The energy storage super cycle presents opportunities across the entire industry chain, from system integration to battery cells and upstream materials [26][32] - Key players in the energy storage system segment include Sungrow Power Supply, which holds a 35% global market share, and Hecate Energy, with a 20% market share in China [27] - Leading battery cell manufacturers like CATL and EVE Energy are expected to benefit from the surge in demand, with CATL maintaining a strong position in both energy storage and power batteries [29] - Material companies such as Tianji, Dofluor, and Huasheng Lithium are positioned to gain from price increases due to supply constraints [30]