1、 The heat continues to rise

In recent years, the development momentum of new energy storage in China has been strong. According to statistics from the National Energy Administration, as of the end of 2024, the cumulative installed capacity of new energy storage projects that have been completed and put into operation nationwide is 73.76 million kilowatts/168 billion kilowatt hours, with an average energy storage time of about 2.3 hours. The installed capacity has increased by 130% compared to the end of 2023.

Under the promotion of multiple parties, China's flow battery energy storage market is showing a vigorous development trend, and many enterprises are accelerating their layout. In March of this year, the Weilide 100MW/400MWh all vanadium liquid flow energy storage power station project started construction in Leshan City, Sichuan Province. The total investment of the project is 1.4 billion yuan, covering an area of 44.5 acres, and building a three in one pattern of "energy storage equipment area+booster station+comprehensive building".

In February, the integrated production line project of 500MW/2GWh all vanadium liquid flow energy storage system and the 300MW/1200MWh all vanadium liquid flow energy storage power station project in Yongren County, Chuxiong Prefecture, Yunnan Province started construction, with a total investment of approximately 3.627 billion yuan; In January, the Zhoukou City Liquid Flow Battery Industry Chain Comprehensive Base project with a total investment of 8.08 billion yuan started construction. After the project is put into operation and achieves results, it is expected to have an annual output value of 17.26 billion yuan.

2、 Long term energy storage 'potential stocks'

In the eyes of industry insiders, with the continuous increase of policies and accelerated implementation of projects, flow batteries are expected to play a greater role in new energy consumption, power grid peak regulation, and inject new momentum into China's energy structure transformation.

From a performance perspective, flow batteries have the characteristics of long cycle life, high safety, and environmental friendliness, and exhibit significant advantages in energy storage duration. In domestic flow battery energy storage projects, the energy storage time of flow batteries is generally more than 4 hours, and some projects have an energy storage time of up to 6 hours.

It is understood that compared with short-term energy storage, long-term energy storage has significant advantages in improving the capacity of new energy generation and consumption, enhancing the flexibility of the power grid, etc. It can provide longer power security reserves in response to seasonal climate or extreme weather, and achieve cross day, cross month, and even cross season charging and discharging cycles. Therefore, it has attracted attention from the industry.

Zhao Tianshou, an academician of the CAS Member, said earlier that liquid flow battery is an ideal long-term energy storage technology with the advantages of safety, reliability, convenient capacity expansion and long cycle life. The inherent safety, capacity and power decoupling characteristics of aqueous electrolytes in flow batteries enable them to flexibly adapt to energy storage needs of different time periods and scales.

3、 The cost gradually decreases

However, while facing vast opportunities, there are still certain challenges in the development of flow batteries. It is understood that there is currently room for optimization in the power density and energy density of flow batteries. For example, mainstream all vanadium flow batteries use expensive vanadium metal, with a storage capacity cost of over 2000 yuan per kilowatt hour, and their economic viability is lower than that of pumped storage and other long-term energy storage technologies, which to some extent limits their large-scale application.

In the opinion of the interviewee, the cost reduction space of flow batteries depends on the localization process of key materials. By improving key technologies such as battery current density and electrolyte utilization, the system cost can be reduced. At the same time, it is possible to consider providing initial high cost technologies such as flow batteries with financial subsidies and tax incentives, and accelerating the cost recovery of energy storage through improving market mechanisms such as electricity and carbon markets, as well as innovating business models such as shared energy storage.

It is understood that the cost per kilowatt hour (LCOE) of flow batteries exhibits the following characteristics over long-term use (such as 10 years or the entire lifecycle):

1. Vanadium flow battery

Application on the power generation side: In the 300MW/1200MWh project, the initial investment cost is 1.33 yuan/Wh, with 660 cycles per year, a discharge efficiency of 75%, a residual value of 20%, and a full life cycle (20 years) electricity cost of 0.211 yuan/kWh. If the residual value is increased to 70%, the LCOE can be further reduced to 0.191 yuan/Wh.

Full lifecycle cost: For a system with an energy storage duration of 10 hours, the initial investment cost is approximately 2100 yuan/kWh. After considering the residual value of the electrolyte, the actual cost drops to 1020 yuan/kWh (equivalent to a cost of approximately 0.2 yuan/kWh per kilowatt hour).

2. Zinc iron flow battery

Weijing Energy Storage has set a goal of reducing the cost of electricity per kilowatt hour to below 0.2 yuan/kWh within three years. The zinc iron flow battery has a cycle count of 30000 times, a service life of 25 years, and lower maintenance costs throughout its entire lifecycle.

3. Cost sensitivity factors

Initial investment: The initial investment cost of flow batteries is usually between 2.5-4 yuan/Wh, but through electrolyte leasing models (such as the Rongke energy storage project), the initial investment can be reduced by about 50%.

Energy storage duration: The longer the energy storage duration, the higher the economic efficiency of the flow battery. For example, the full lifecycle cost of a 4-hour energy storage system is 1875 yuan/kWh, while a 10 hour system reduces it to 1020 yuan/kWh.

Cycle times and efficiency: The zinc iron flow battery can reach 30000 cycles, with a discharge efficiency of 75%. The cycle life of the all vanadium flow battery is about 12000-20000 cycles.

4. Compare with other technologies

The cost per kilowatt hour of lithium batteries is about 0.5-0.6 yuan/kWh, but flow batteries have significant cost advantages in long-term energy storage (≥ 4 hours).

The 10-year electricity cost of flow batteries varies depending on the technology route and scenario:

Vanadium flow battery: approximately 0.19-0.21 yuan/kWh in power generation applications (considering high residual value);

Zinc iron flow battery: The target is ≤ 0.2 yuan/kWh.

The actual cost needs to be calculated based on specific project parameters such as initial investment, cycle times, residual value rate, etc., but flow batteries have shown economic potential in the field of long-term energy storage.