China’s energy storage market continued to surpass expectations in 2024, with over 165GWh of projects planned, the sector saw significant expansion, including BYD’s impressive 300MW/1.2GWh system.  What jumped out for Electrios was the steep decline in the price of energy storage winning bids.

The average winning bid price for 2-hour lithium iron phosphate (LFP) energy storage systems in 2024 was 86 $/kWh, down 43% compared to the average price in 2023.  

A number of factors played a part in low price cells beyond the usual cutthroat competition.

China has become increasingly competitive, with more players entering a market with an already relatively low barrier to entry. The market has become quite crowded in 2024 leading to more aggressive bidding and lower prices. However technical innovations shook the BESS sector, such as

• The emergence of 6MWh & 7MWh systems.
• VERY large-scale projects, for example the Ningxia Wuzhong project: The largest single project completed in December 2024 was the Ningxia Wuzhong 1GW/2GWh grid-side shared energy storage power station project.  As the scale of energy storage deployments has increased, manufacturing costs have come down, resulting in lower system prices.

It’s important to note variations in procurement contacts based on the nature of the project

Centralized/Frame Procurement: Projects procured through centralized or frame agreements tended to have lower winning bid prices compared to individual projects. Due to the larger scale of these procurements, which allows for better pricing negotiations.

Chinese BESS Integrators Expand into Saudi Arabia’s 

Saudi Arabia is rapidly emerging as a major player in the energy storage sector, with ambitious plans to deploy 48GWh of capacity by 2030. In the first round of Saudi Arabia’s massive battery energy storage initiative, nine Chinese companies have been shortlisted for projects totaling 2GW/8GWh. These companies include:

• CEEC
• CPECC
• China Southern Power Grid
• Envision Energy
• Jinko Power
• Huaneng Group
• Power China
• GCL

Sungrow has achieved a major milestone by securing a contract for the world’s largest energy storage project, boasting an impressive 7.8GWh capacity. This project utilizes high-performance battery cells developed by CALB.