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| Updated | July 05, 2023 |
The global cell shipments in 2022 reached 144 GWh, while the installed capacity amounted to only 44 GWh, a gap of more than three times. InfoLink estimates that the cell shipments in 2023 will exceed 230 GWh, with a grid-connected capacity coming in at 95 GWh. This figure indicates that the gap between the two will remain, which raises concerns about oversupply among cell manufacturers. The following section will provide an analysis of the causes of such a divergence.
The gap between the cell shipments and installed capacity is mainly attributed to long construction time of energy storage sites. Due to the time required for storage installation after shipment, the grid-connected capacity cannot reflect the shipment volume promptly, thus the difference in data. Currently, it takes about six months to a year or more to build an energy storage site, which explains why cells shipped in 2022 may not be installed and connected to the grid until 2023. Such a phenomenon is particularly common at large-scale sites, where the longer construction time results in a larger capacity gap compared to C&I and residential storage.
Except for some sites that are still depleting inventory, large-scale projects will install an additional capacity of 3% to 10% in their storage systems to comply with operational standards, making the actual installed capacity higher than the nominal capacity. For example, the actual installed capacity of a 10 GWh site may be as high as 10.3 GWh to 11 GWh.
In addition to the time gap, there were other factors that contributed to the large gap between the shipments and grid-connected capacity in 2022, such as the difficulty in collecting grid-connection data for C&I and off-grid storage, the energy loss of cells during the grid-connection process, and the fact that some cells were used to replace previous ones. Unless the construction period of large-scale energy storage sites is significantly shortened, the capacity gap is expected to remain until 2025. In addition, as behind-the-meter energy storage systems will be standardized in the future, installing energy storage facilities will become as simple as installing domestic appliances, thereby bringing the installed capacity more aligned with shipments. However, compared to grid-scale energy storage, behind-the-meter storage has a modest impact due to its limited scale. Overall, InfoLink estimates that global electrochemical storage will exceed 175 GWh by 2025.
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