Published PM GMT+8 GMT+8, July 22, 2025,
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1. Global Market Outlook
- The global energy storage capacity is projected to reach 271 GWh in 2025, marking a 31% year-on-year increase.
- Battery production is expected to exceed 406 GWh, driving demand for approximately 240,000 tons of lithium carbonate.
- Regional differences are notable, with China, the U.S., Europe, and emerging markets each showing distinct trends.
2. China Market Highlights
- Installed capacity and utilization are rising: From January to May, newly added storage capacity reached 13.95 GW / 34.76 GWh, up 79% / 74% year-on-year.
- Boom in PV installations: A 74% increase in new PV capacity has significantly boosted storage demand.
- Grid-side storage dominates, accounting for nearly two-thirds of the market, with commercial value and dispatch capabilities steadily improving.
- Stronger economics: Market-oriented power reforms and capacity pricing policies are enhancing the economic viability of storage projects.
3. U.S. Market Snapshot
- Continued growth momentum: From January to April, 1.73 GW of new storage capacity was added, up 41% year-on-year.
- Improved project completion: The average project completion rate reached 35%, a 13 percentage point** increase from the same period last year.
- Long-term risks: Trade tariffs and supply chain challenges may slow new demand growth and introduce cost uncertainties in future construction.
4. Trends in Europe
Utility-scale and C\&I storage are gaining ground: In 2024, new battery storage additions hit 21.9 GWh, up 15% year-on-year.
Country-specific developments:
- Germany: Rapid expansion of utility-scale and C\&I storage; IRR for C\&I storage exceeds 12%.
- Italy: Utility-scale growth offsets the decline in residential storage, with 5,921 MWh added in 2024.
- UK: Steady growth in large-scale storage, with approved projects surpassing 120 GWh.
5. Emerging Market Potential
- Middle East: Saudi Arabia and the UAE are expected to deploy over 30 GWh of storage.
- Southeast Asia: Countries like the Philippines and Vietnam are advancing storage projects through supportive policies.
- Latin America: High solar penetration in Chile and Brazil is creating strong, inflexible demand** for storage.
6. Supply Chain & Pricing
- Battery cell production surging: Total output from January to May reached 166.7 GWh, up 67% year-on-year.
- System and EPC costs declining, while battery cell prices remain stable.
- Cell makers have strong pricing power, due to high industry concentration and favorable profit distribution.
7. Forward-Looking Insights
- China: The market is expected to maintain solid growth through 2025, with H2 demand comparable to H1.
- U.S.: Risks in 2025 remain relatively low, though future construction costs are uncertain.
- Europe: Continues shifting toward utility-scale dominance, with market mechanisms in the UK and Germany steadily improving.
- Emerging Markets: Will become key contributors to global storage growth, offering tremendous potential.
Source: CITIC Futures, compiled by InsightEmpower
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