Energy Storage Cells Reach a Turning Point in Supply and Demand

From overcapacity in 2024 to supply shortages in 2025, the supply and demand pattern of energy storage cells has fundamentally reversed. Leading companies are operating at full capacity with orders booked until 2026. This supply and demand situation has spread to upstream and downstream of the industry chain, even leading to situations where "paying extra doesn't guarantee a delivery."

So, what caused this "cell shortage"?

First, a series of policies ignited the "531 rush installation" phenomenon, causing market demand to be brought forward.In February of this year, the State Council issued Document No. 136, "Notice on Deepening the Market-Oriented Reform of New Energy On-Grid Tariffs to Promote High-Quality Development of New Energy." This document sets time limits for existing and new projects. Existing projects connected to the grid before June 1st can enjoy a "differential pricing mechanism," while new projects connected after June 1st must determine their electricity prices entirely through market competition. This policy directly led to a large number of projects rushing to install before the "531 deadline," driving up the demand for energy storage.

Secondly, the current energy storage cell market is at a critical stage of upgrading from 300+ Ah ​​to 500 Ah+ and even larger capacities. Major manufacturers are shifting their R&D and production capacity resources towards this new generation of cells, limiting the capacity expansion of current mainstream models such as 314 Ah. Furthermore, the construction of production lines and equipment debugging for this new generation of high-capacity cells, leading to mass production, takes time. The failure to release new capacity in a timely manner, coupled with the gradual reduction of existing capacity, has created a capacity gap of "insufficient old capacity and unreleased new capacity," further exacerbating the supply shortage.

In addition, the demand in the domestic and international energy storage markets is experiencing explosive growth.

Data shows that as of the end of September this year, our country's new energy storage installed capacity has reached 103 million kilowatts, more than 30 times the level at the end of the 13th Five-Year Plan period, accounting for over 40% of the global total installed capacity, ranking first in the world. The overseas market is equally vibrant. In the first three quarters of 2025, Chinese companies have already signed 111 overseas strategic cooperation agreements/orders/projects, totaling 182.79 GWh. (See previous article: Energy Storage Orders Exceed 480GWh from January to September 2025! CATL, EVE, Envision, REPT, BYD Energy Storage, GOTION High-Tech, and Canadian Solar Lead the Way!) Among these, the Middle East and Australia, driven by energy transition goals, have seen a surge in demand for energy storage projects, with multiple gigawatt-scale orders emerging, fueling strong growth in overseas market demand.

Based on these factors, first- and second-tier energy storage cell manufacturers are experiencing a surge in orders. According to incomplete statistics from Energy Storage Headlines, energy storage cell manufacturers have received orders totaling 363.3GWh since 2025!