Resilience in Energy Storage: Navigating China’s Policy Storm and Market Evolution

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Steady Progress in Energy Storage: Where Does the Resilience Come From?

Published: May 26, 2025 | Views: 44 times | Author: Administrator

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In 2025, China’s energy storage industry is experiencing an unprecedented “policy storm.” The termination of mandatory storage requirements through Document 136 and the acceleration of the electricity spot market construction as outlined in Document 394 represent a series of new policies that not only reshape the foundational logic of the industry but also showcase remarkable resilience within the energy storage sector amid challenges. This resilience stems from self-innovation driven by policy changes, value reconstruction motivated by market dynamics, and the combined support of technological advancements and global strategies.

1. Policy Transformation: From “Policy Cradle” to “Market Survival”

Mandatory storage requirements were a significant driver behind the explosive growth of energy storage installations in China over the past decade. However, their adverse effects have become increasingly apparent as many energy storage facilities turned into “ornamental assets” with low utilization rates. The issuance of Document 136 in February 2025, which marked the end of mandatory storage, effectively severed administrative control over the market. The energy storage industry is undergoing a value awakening. As the policy crutch is gradually removed, the price competition under market mechanisms is set to evolve into a battle for value.

Following this, Document 394 established hard requirements for comprehensive coverage of the electricity spot market, providing a platform for realizing the value of energy storage. The document specifies that provinces such as Hubei and Zhejiang must achieve formal operation by the end of 2025, while 16 provinces, including Fujian and Sichuan, are to initiate trial operations for continuous settlements. Meanwhile, the southern regions are exploring cross-province trading mechanisms. This not only generates demand for high-precision forecasting and rapid response technology but also fosters new models such as virtual power plants and shared energy storage.

Under this combination of policies, the energy storage industry is compelled to step out of its comfort zone and demonstrate its economic value through market mechanisms. While this transformation brings challenges, it clears the path for the industry’s long-term healthy development.

2. Market Reconstruction: From “Single Path” to “Revenue Puzzle”

The comprehensive rollout of the electricity spot market has significantly altered the revenue logic for energy storage. New time-of-use pricing policies in regions like Jiangsu and Jiangxi have compressed traditional peak-valley arbitrage opportunities by introducing low-cost midday periods and adjusting the price difference calculation base. However, this has also led to the emergence of diverse revenue models, including demand response and ancillary services. Energy storage systems must now operate like “financial traders,” capturing arbitrage opportunities from real-time price fluctuations while integrating capacity leasing, frequency regulation services, and participation in ramping and backup markets to achieve multiple revenue streams.

Industry predictions suggest that with the full implementation of the spot market, an increasing number of provinces are expected to realize the combination of revenues from the spot market and ancillary services, pushing the energy storage sector towards a more efficient model characterized by “multi-use and time-sharing.” For instance, Singularity Energy collaborates with industrial parks to develop “solar + storage + microgrid” systems, allowing owners to achieve “zero investment and profit-sharing” through energy management models. To enhance energy storage revenues, conversion efficiency has become a crucial metric for evaluating system performance. Singularity Energy’s latest energy storage product, the eBlock-261, has emerged as “the first energy storage product capable of self-evolving in the electricity spot market,” boasting a conversion efficiency exceeding 91%, surpassing the industry average. Additionally, it features high energy density, compact design, and multiple safety protections, making it suitable for various applications, including peak shaving and filling for commercial and industrial use, virtual power plants, backup power, and three-phase imbalance management, earning it the title of “the energy storage powerhouse for commercial use.”

3. Technological Leap: A Dual Revolution of Safety and Intelligence

In light of the policy storm, stringent safety regulations have emerged as another key theme in the industry. On May 7, the National Energy Administration and four other departments jointly issued a notice regarding the enhancement of safety management in electrochemical energy storage, mandating improvements in battery safety, strict control of project access, and prohibiting energy storage facilities in densely populated areas. As energy storage creates value and market-driven development unfolds, companies are forced to shift from a “price war” to a “value war” that balances safety and efficiency.

Singularity Energy’s products, known as Smart Energy Blocks, utilize an “All In One” design, integrating long-life battery cells, efficient bidirectional balancing BMS, high-performance PCS, active safety systems, intelligent distribution systems, and thermal management systems into a single cabinet. This innovative design achieves a high degree of integration among the components of energy storage systems, effectively addressing user concerns regarding the safety of electrochemical storage while enhancing system efficiency and reducing operational costs, thus providing a new solution for the large-scale application of energy storage.

4. Global Expansion: From “Intense Competition” to “Emerging Opportunities”

As domestic market competition intensifies, international expansion has become a “second growth curve” for leading companies. 2024 marks the beginning of Singularity Energy’s internationalization, with products already certified for overseas markets. The company secured its first European order in 2024 and completed delivery in the fourth quarter, followed by a successful acquisition of its first order in Italy in early 2025. To better serve international customers, Singularity Energy has established a specialized localized service team and plans to set up factories and branches overseas. However, venturing abroad is not without challenges. Facing local production capacity policies in Europe and North America and fierce competition in emerging markets, Chinese energy storage companies are leveraging technological advantages combined with localized services to seize leadership in the global energy transition. In this process, companies with integrated capabilities across the entire supply chain will gain a competitive edge.

5. Insights from Singularity: A Model of Resilient Growth

In this endless marathon, as a witness to industry transformation, Singularity Energy has maintained its position as the leading supplier of commercial and industrial energy storage in China for two consecutive years. This reflects the key to the success of Chinese energy storage companies:

• Technological Commitment: Singularity Energy is more than just a hardware company; over 60% of its team is engaged in software development. The company aims to build an ecosystem defined by software that deeply integrates smart algorithms with the electricity market, driving an increase in the value of energy storage in electricity trading. Since its inception, the company has consistently invested a high proportion of its resources in research and development, pursuing continuous exploration and breakthroughs at the forefront of technology, accumulating over 100 patents and 126 authoritative certifications and testing reports over five years, thereby establishing a formidable competitive moat.
• Market Penetration: In the face of the complex and changing domestic and international markets, Singularity Energy adheres to the principle of “customer first,” deeply exploring user needs, and continuously optimizing products and services. Domestically, from major bases in the northwest to coastal industrial parks, the plug-and-play nature of the eBlock smart energy block addresses the challenges of fragmented scenarios, providing integrated energy solutions that help users optimize their energy structure and reduce costs. Internationally, Singularity Energy has gained widespread recognition from overseas clients due to its deep understanding of local policies and culture, as well as its responsive service system.
• Co-constructing Ecosystems: The company has established a collaborative network covering investment, construction, and operation with over 100 strategic partners, promoting a shift in the industry from zero-sum competition to mutual benefit and win-win scenarios.

The future is now. As the energy storage industry progresses, it is not only a contest of technologies but also a competition of ecosystems. In this “policy storm,” the resilience of the energy storage sector derives from a profound respect for market dynamics, a commitment to technological innovation, and a keen awareness of global opportunities. As the industry transitions from “wild growth” to “rational prosperity,” only those enterprises that genuinely create value can navigate through market cycles.