China recently launched its largest energy storage facility in Shandong Province, which has been put into operation with a capacity of 795 MW.

The new facility, developed by Jinhui New Energy Company, is located in Lijin County and can store up to 1 million kilowatt-hours of electricity, enough to power nearly 150,000 homes for one day.

This project is a landmark step in the development of energy storage in China. The country’s investment in grid-connected batteries increased by 364% last year, amounting to 75 billion yuan (about $11 billion), making it possess the largest storage fleet in the world with a capacity of 35.3 gigawatts since March 2023.

In May 2023, China raised its energy storage target to a minimum of 40 gigawatts by the end of 2025, an increase of 33% from the previous target, as part of its efforts to reduce carbon emissions and achieve a balance between supply and demand for electricity, especially with the increase in energy production from renewable sources.

Local governments have played an essential role in promoting this expansion by requiring renewable energy plants to integrate storage systems despite challenges posed by highly regulated energy markets, including incentivizing storage use and improving pricing and technology.

Despite improving conditions, financial viability remains a challenge due to the lack of flexible energy pricing, and experts call for pricing reforms and technological improvements to address these issues.

The storage sector in China enjoys great support from major energy users, such as industrial complexes and electric car charging stations, because China is a major market for electric cars globally, which enhances the pressure on the energy grid and highlights the importance of storage as a means of relieving the pressure.