One month after the suspension of mandatory energy storage requirements, the energy storage market has become even more vibrant!
On February 9, the National Development and Reform Commission and the National Energy Administration jointly released a notice titled “Notice on Deepening the Market Reform of Renewable Energy Grid Pricing to Promote High-Quality Development of Renewable Energy” (hereafter referred to as “Document 136”). This document clearly stated that “the installation of energy storage cannot be a prerequisite for the approval, grid connection, or generation of new renewable energy projects.” Following this policy announcement, the energy storage industry experienced significant upheaval, raising concerns about a potential decline in energy storage demand. However, more than a month later, observations from Hua Xia Energy Network indicate a drastically different scenario. Various local governments have started to introduce policies encouraging the integration of energy storage with renewable energy projects, emphasizing the importance of integrated source-network-load-storage systems, and the demand for distributed solar energy coupled with storage is increasing daily.
Overall, the energy storage sector is swiftly transitioning from being “policy-driven” to “market-driven.” After a brief period of adjustment, the industry is entering a robust new phase.
Local interest in energy storage is on the rise
Following the halt of mandatory energy storage requirements, provinces like Yunnan and Guizhou have quickly rolled out new policies to promote energy storage integration. On February 10, just a day after the release of Document 136, the Guizhou Provincial Energy Administration published the “Management Measures for Wind and Solar Power Projects in Guizhou Province (Draft for Comments)” (hereafter referred to as “Guizhou Wind and Solar Management Measures”). The document states that projects included in the province’s annual construction plan for wind and solar power must ensure grid connectivity and provide energy storage capacity of at least 10% of the installed capacity (sufficient for two hours of operation). It also mentions that projects not completed within the required timeframe of over a year will not be connected to the grid.
The document further encourages the orderly planning of new energy storage projects based on regional renewable energy construction scale and grid demands, promoting the simultaneous commissioning of new energy storage projects in areas with grid constraints. Additionally, it encourages project investors to voluntarily increase the ratio of energy storage provision and storage service purchases for wind and solar projects.
In early March, the Yunnan Provincial Energy Administration issued the “Management Measures for the Construction and Operation of Energy Storage Projects for New Energy in Yunnan Province (Draft for Comments),” which mentioned that 175 new energy projects are planned for development in Yunnan in 2025, with a total installed capacity of 14,489,050 kW. These projects are required to allocate 10% of their installed capacity for energy storage resources, which can be achieved through the purchase of shared energy storage services.
Within a month of Document 136’s release, two provinces announced policies to encourage energy storage integration in new energy projects. It will be interesting to see whether other provinces will follow suit. The national government’s move to suspend mandatory energy storage requirements aims to allow the energy storage sector to return to its market fundamentals and let genuine demand dictate the market. However, for local governments, energy storage remains a crucial tool for enhancing renewable energy consumption and ensuring energy security. They are introducing more flexible energy storage policies in an effort to find a new balance between policy guidance and market-driven strategies.
It’s worth noting that previous projects requiring energy storage were mainly centralized renewable energy projects. Now, policies encouraging energy storage integration in distributed renewable energy generation projects are gradually increasing. On February 10, alongside the Guizhou Wind and Solar Management Measures, a supporting policy titled “Implementation Details for the Development and Construction of Distributed Solar Power Generation in Guizhou Province (Draft for Comments)” was also released. This document allows county-level energy authorities to guide investors in voluntarily constructing or leasing distributed energy storage facilities based on the local development of distributed solar power.
On March 17, the Ningxia Development and Reform Commission published the “Implementation Details for the Development and Construction of Distributed Solar Power Generation in Ningxia Hui Autonomous Region (Draft for Comments),” which supports cooperation between local governments and upstream and downstream solar development companies and financial institutions to promote the construction of “solar + storage” and integrated energy storage scenarios.
Leveraging the “Source-Network-Load-Storage Integration”
Since the announcement of Document 136, the concept of “source-network-load-storage integration” has increasingly appeared in the work documents of central energy enterprises and local governments. For example, on March 5, Shandong Province issued the “Implementation Details for the Pilot Program of Source-Network-Load-Storage Integration,” encouraging the implementation of this integration to enhance renewable energy consumption and support the construction of a new type of power system. On March 7, China Energy Engineering Corporation announced that it is integrating the full energy and computing power industry chain through source-network-load-storage integration. On March 12, the government of Luoyang, Henan Province, published its 2025 work report, stating that it will implement 40 integrated projects this year. Similarly, the Lingbao Municipal Government in Henan mentioned plans to invest 1 billion yuan in a source-network-load-storage integration project by the end of the year and to plan for over 14 additional projects.
Source-network-load-storage integration is a new operating model that plans and operates power generation sources, the grid, loads, and energy storage as a cohesive unit. This model offers mutual benefits across various stakeholders. For local governments, these projects can effectively reduce carbon emissions and create new pathways for renewable energy consumption, contributing to sustainable development goals. For power generation enterprises, it provides a fresh opportunity to navigate the market reforms in renewable energy pricing while exploring new development models within the new policy environment. For consumers, it acts like a newly established renewable energy power plant, significantly lowering electricity costs and enhancing market competitiveness.
Financial institutions are also keenly interested in the source-network-load-storage integration projects. Recently, the Bank of China’s Weihai branch issued the first loan for a source-network-load-storage integration pilot project in Shandong Province. This model, which has high costs and long construction cycles, requires substantial financial support. The involvement of financial institutions alleviates the funding pressure on project developers and helps banks optimize their credit structures while enhancing their capability to serve the real economy.
Thus, it is not surprising that the promotion of such multi-beneficial projects like source-network-load-storage integration is being actively pursued across various regions.
The integration of solar and storage is unstoppable
Document 136 clearly states that all new renewable energy projects commencing operations after June 1, 2025, must participate in market competition. In recent forums, Professor Liu Yafang from Zhejiang University emphasized that if renewable energy companies wish to achieve satisfactory returns in future electricity market competition, they must consider system adjustment costs and power quality control costs. Energy storage will become a strategic partner in the high-quality development of renewable energy.
On March 23, GCL-Poly Energy (SZ:002015) mentioned in a research briefing that green electricity generation companies will shift from “subsidy dependence” to market competition, and the importance of technological innovation (e.g., wind and solar power forecasting, energy storage integration) is becoming increasingly prominent. Due to the fluctuating nature of solar power generation during the day, energy storage solutions are becoming more aligned with these variations, leading to greater industry focus on solar-storage integration.
On March 5, at the first large-scale renewable energy exhibition held after Document 136 was released—the China Jinan Solar Energy Comprehensive Energy Exhibition—Hua Xia Energy Network observed that both solar and energy storage companies prominently featured solar-storage integrated products and solutions. For instance, Sungrow Power Supply (SZ:300274) launched integrated solutions for “zero-carbon parks, zero-carbon homes, and zero-carbon industries,” achieving comprehensive coverage in products, scenarios, data, and services through integrated technology. JA Solar Technology (SZ:002459) introduced a full-scenario solar module solution capable of operating in extreme environments, along with accompanying energy storage systems.
Energy storage companies are also launching products specifically designed for solar applications. Pylontech (SH:688063), a leading player in the domestic energy storage market, has introduced energy storage products tailored for solar applications, such as a 113 kWh air-cooled energy storage cabinet for small commercial parks and 417 kWh direct current cabinets for large commercial solar projects. The upcoming listing on the Hong Kong Stock Exchange of Seg Solar has also introduced a commercial solar-storage system that supports “charge and discharge” functionality, allowing for flexible charging and discharging based on real-time changes in solar generation and electricity load.
Additionally, recent releases from various solar and energy storage companies include products targeting the electricity spot market. For example, Greewatts has launched the NEXA 2000 balcony solar-storage unit, which integrates inverter functions and expandable energy storage capabilities. The NEXA 2000 features an optimized usage time function that helps reduce electricity costs by charging from the grid during low-price periods and discharging during high-price periods, significantly saving costs.
The cooperative efforts between solar and energy storage companies highlight the understanding that solar must integrate with energy storage to maximize benefits in the electricity spot market, opening up vast market opportunities for both industries.
