Sungrow: Energy Storage Installation Growth Expected at 30%-50% Over Next Three Years

Sungrow Bullish on Energy Storage, Expects Rapid Growth Over Next Three Years

On April 27, Sungrow shared key insights on the energy storage industry's development prospects during an earnings call. The company stated that despite ongoing raw material cost pressures, overall energy storage installation capacity will continue to grow over the next three years, with an expected growth rate of 30% to 50%, signaling firm confidence in the industry's medium- to long-term trajectory.

Raw Material Price Hikes Show Divergent Impact, Large-Scale Projects Under Notable Pressure

During the conference, Sungrow noted that rising prices of key raw materials such as lithium carbonate are posing challenges to the profitability of energy storage projects. However, the impact is clearly divergent across projects of different scales.

For small and mid-sized energy storage projects, their more flexible operating models allow them to pass upstream costs downstream more swiftly, resulting in relatively limited impact. In contrast, for ultra-large-scale projects with substantial investment volumes and long construction cycles, the cost pass-through mechanism is relatively delayed, and raw material price volatility has placed notable downward pressure on their return on investment.

Long-Term Outlook for Energy Storage Remains Positive with Strong Growth Certainty

Despite short-term cost-side disruptions, Sungrow remains optimistic about the medium- to long-term trajectory of the energy storage industry. The company explicitly stated that overall energy storage installation capacity will continue to increase over the next three years, with growth expected at 30% to 50%.

This assessment is underpinned by multiple factors. From a policy perspective, major global economies continue to advance carbon neutrality goals, and renewable energy storage mandates are being continuously strengthened, providing a solid policy foundation for the storage market. From a technology standpoint, energy storage systems are seeing continuous improvements in energy density, cycle life, and safety performance, with system costs on a long-term downward trend. From a market perspective, as wind and solar installation capacity rapidly expands, the power system's demand for peak shaving and frequency regulation is becoming increasingly urgent, further highlighting energy storage's role as a critical pillar of the new power system.

Industry Competition Intensifies, Leading Companies Poised to Expand Advantages

Notably, under the dual pressures of raw material price volatility and intensifying market competition, the energy storage industry's consolidation process may accelerate. Smaller manufacturers are relatively weak in supply chain bargaining power and R&D investment, with limited risk resilience. As an industry leader, Sungrow — leveraging its deep expertise in solar-storage integration, global channel network, and economies of scale in procurement — is well positioned to further expand its market share during the industry consolidation.

Outlook: Energy Storage Remains a High-Certainty Sector

Overall, while short-term raw material cost fluctuations have introduced some uncertainty to the energy storage industry, from a medium- to long-term perspective, energy storage's growth logic as a core component of the energy transition remains unchanged. Sungrow's projected annual growth rate of 30% to 50% reflects both confidence in the industry's prospects and provides the market with a relatively rational anchor for growth expectations.

As technological iteration continues to drive down costs, policy frameworks become more refined, and business models mature further, the energy storage industry is poised to enter a new phase of growth in both volume and value over the coming years. For companies across the industry value chain, finding the balance between scale expansion and profitability will be the key challenge in determining the competitive landscape.