Chinese battery manufacturers are expected to see a 75% increase in global shipments of lithium-ion cells for energy storage this year, according to a sector estimate. This growth comes amid a regulatory transformation of China’s electricity market and sustained international demand for storage solutions.
The power market reform introduced in China is altering the economics of energy storage. New projects are now required to sell output through market-based auctions rather than at administered tariffs. This change allows battery operators to capitalise on price differences by charging when rates are low and discharging when prices are higher.
A regulatory shift at the heart of storage growth
The regulatory adjustment has had a direct impact on the use of installed capacity. Battery storage facilities operated an average of 3.08 hours per day in the third quarter, up from a lower level a year earlier, according to data from the China Electricity Council. This reflects improved price signals and better integration of storage into the power system.
In parallel, several provinces have implemented capacity tariffs since late 2024. These mechanisms provide dedicated payments to facilities kept on standby to stabilise the grid, in addition to other support measures. These initiatives are part of a government plan to nearly double national battery storage capacity by 2027.
Industrial dominance supported by regulation
China holds the bulk of global production of energy storage battery cells. The six leading global suppliers are Contemporary Amperex Technology Ltd, HiTHIUM, EVE Energy, BYD, CALB and REPT BATTERO, all headquartered in China. EVE Energy recorded a 35.51% increase in energy storage sales volume over the first three quarters, while REPT BATTERO reached a quarterly shipping record.
Chinese battery exports, including for storage and electric vehicles, reached $66.761bn in the first ten months of the year. Batteries are now the country’s top clean-tech export in this segment. China also holds around 40% of the world’s battery storage capacity, recently overtaking pumped hydro storage.
Contrasting regulatory frameworks internationally
Globally, demand is driven by the expansion of data centres and the need to reinforce ageing electricity grids. Deployment prospects remain heavily dependent on local regulatory frameworks. In the United States, certain rules restrict access to investment tax credits for projects involving designated foreign entities, which include Chinese firms.
According to a sector analyst, Chinese battery cell manufacturers are currently operating at full capacity to meet global demand, highlighting the combined effect of domestic regulatory shifts and evolving energy rules in key international markets.
