The world shipped 91.6 GWh of energy storage cells in the first half of 2023 (75.7 GWh for utility-scale and C&I ESS and 15.9 GWh for residential and telecom ESS), with a merely 11% quarter-on-quarter increase in the second quarter, according to the Global Lithium-Ion Battery Supply Chain Database recently released by InfoLink. Demand sustains rapid growth in China, while losing momentum in Europe and the U.S. due to inventory pressure and high interest rate before potential recoveries in the third quarter.
Manufacturers shipping the most are CATL, BYD, EVE Energy, Rept Battero Energy, and Hithium. The top five all shipped more than 5 GWh, pushing the five-firm concentration ratio (CR5) to reach 69.3%. Manufacturers from the sixth to tenth shipped 3-5 GWh. CR10 comes in at 90%. CATL’s market share dropped from 41% in 2022 to 33% in the first half of 2023. In addition to price wars, inventory issues in Europe and the U.S. affected the shipping of leading manufacturers. Meantime, competition intensified as industry peers expanded production, and the Chinese market boomed, pressuring manufacturers with most shipments destined for non-China markets.
South Korean manufacturers, Samsung SDI and LG together shipped 7 GWh of NCA/NCM energy storage cells in the first half of this year, with LG picking up steam, accounting for 7.6% of that shipment volume.
For utility-scale and C&I energy storage projects, CATL shipped more than 25 GWh. The rest of the top five shipped 5-10 GWh. BYD, having commissioned blade battery capacity and released MC Cube, improved market share with a cost advantage. Its market share may increase from 10% in 2022 to 14% this year, affecting market prices. At the same time, EVE Energy, Rept Battero Energy, Hithium, and other cell manufacturers expand production to divvy up the market. Cell prices will approach lower than RMB 0.5/Wh amid a foreseeable price war in China in the second half of 2023.
For residential and telecom energy storage projects, Europe saw robust demand last year. System integrators, distributors, and install companies hoarded amid the short supply, which, and the lack of installation workers resulted in high inventory levels. In the first half of 2023, despite ongoing installations, the market was still depleting inventory. Therefore, installed capacity sustained steady growth, but inventory draws weakened significantly. The top five manufacturers shipped 2-4 GWh. In the second half, the total shipment volume of residential and telecom energy storage cells will increase, potentially exceeding 30 GWh, as inventory levels fall.
In the first half of 2023, policy trajectory, price changes, supply chain issues, and inventory depletion created concerns in the energy storage market. The growth of shipment volumes decelerated significantly. This year, the world may ship 210 GWh of energy storage cells, 175 GWh for utility-scale and C&I ESS, and 35 GWh for residential and telecom ESS, according to InfoLink’s Global Lithium-Ion Battery Supply Chain Database. In 2024 and 2025, the increase in cell shipment volumes will become even slower, if existing cell inventory is not depleted efficiently or installation progress is sluggish.