Recently, the CNY 712 million general contracting contract for an energy storage power station by Chenfeng Keji (603685) fell through 48 days after signing. Financing institutions demanded additional risk guarantees, and Chenfeng calculated a risk exposure of CNY 827.5 million, which is even higher than the total contract value.
A power station needs to operate for 20 years. Who can guarantee the certainty of returns for these 20 years? The owners do not want to bear it, and banks are even more reluctant to take it on. Document No. 136 canceled mandatory energy storage allocation, and Document No. 114 established a capacity tariff mechanism. Energy storage has transformed from an accessory of new energy into a financial-grade asset that must generate profits independently in the electricity market. When the uncertainty in revenue calculation for energy storage assets is amplified, no single party can absorb all the certainty risks.
At the "Ningde Quality" 2026 Global Open Month Energy Storage Special Event, Ningde Shidai (300750) introduced the asset-oriented concept of locking in 20 years of long-term wins in energy storage: first, deeply integrating software and hardware with the power grid, transforming the reliability of whole-station operation from cell parameters into system capabilities; second, using systematic empirical verification to test the actual performance of the power station in advance, turning safety, reliability, and long lifespan into evaluable, sustainable, and credible energy assets.
Shifting from battery manufacturing to energy storage asset value, Ningde Shidai is not only attempting to build a new moat but also providing a referential path for the industry at the development turning point of moving from "competing in capacity scale" to "competing in asset value."
Good Cells Are the Starting Point, Not the Endpoint
"Good cells are the starting point, not the endpoint." This statement by Wu Dianfeng, Director of the Energy Storage Technology Center at Ningde Shidai, is a double entendre: it refers to the product, as well as Ningde Shidai's own strategy.
The fundamental skill of cell manufacturing cannot be relaxed. A large energy storage station has thousands of cabinets and millions of cells; the failure of a single cell could trigger thermal runaway and electrical propagation. Ningde Shidai has reduced the cell failure rate to the PPB level—one in a billion—controlling this risk at the source.
Cell quality is only the first layer of the moat; more importantly, Ningde Shidai can extend its understanding of the battery chemistry system further into system design.
Wu Dianfeng drew analogies with products such as NVIDIA's GB300 rack-level system and Apple's iPhone, pointing out that the full release of chip performance relies on the collaborative design of the entire software and hardware. Ningde Shidai's Tianheng energy storage system follows the same product logic: based on high-quality cells, it integrates battery management, energy scheduling, thermal management, power conversion, and grid interaction into a unified design, ensuring that each link matches one another, thereby transforming cell advantages into the operational efficiency, reliability, and long-term asset value of the entire station.
The reason cells are the root is also that they are the source of data and the safety boundary. Ningde Shidai disclosed that it has accumulated data from approximately 3,000 energy storage projects, tests over 100,000 batteries annually, and has accumulated about 500 billion data records. The value of these data lies in their ability to continuously feed back into SOC/SOH estimation, thermal management, failure warning, safety analysis, and control strategies. If the data cannot be precipitated into reusable models and tests, it remains merely a marketing pitch; if it can continuously enter product iterations, it will become a capability that latecomers cannot quickly replicate.
System Integration Is Not Patchwork, But Know-how
The reliability of an energy storage system is essentially also the yield. During a group interview with the media, Wu Dianfeng outlined three key design points for the reliability of energy storage systems: first, less is more, minimalist design—the fewer the components, the less there is to maintain. Second, layer-by-layer decomposition: breaking down the large energy storage system into subsystems, then down to materials, processes, and algorithms, and then using first principles to judge what is necessary and what is redundant. Third, the highly integrated fusion of three major disciplines: electrical, thermal, and mechanical structures—how liquid cooling takes away heat, where to vent after thermal runaway, and what requirements the thermal expansion and contraction of cells impose on the viscosity of thermal conductive pads, all of which are know-how (Note: referring to a set of practical technologies, processes, formulas, procedures, or experiences that can bring competitiveness), not patchwork. When finally running, it should be "harmonically" synchronized: each subsystem knows when to reduce, when to retreat, and how much power to output.
Taking Ningde Shidai's Tianheng energy storage system as an example, its logic is "designing from the bottom up": first clarifying the whole-station requirements and cell boundaries, and then defining subsystems, systems, and the whole station layer by layer, rather than patching together off-the-shelf products from four suppliers—Supplier A's PMS (Power Management System), Supplier B's EMS, Supplier C's PCS, and Supplier D's BMS—into the same container.
The risk of such a "patchwork system" lies not in whether the components can operate, but in the responsibility gaps at the interfaces. The optimal operating point of the PCS may conflict with the cell safety boundary; the dispatch instructions of the EMS may exceed the available power on the DC side; the BMS knows the cell status best but cannot directly affect grid-connected control; when a real fault occurs, the four steps of protection, shutdown, isolation, and recovery may be disconnected from each other. Deep integration is about turning these gaps, which were originally filled by on-site debugging, into product rules in advance.
The premise of deep integration of energy storage systems is that the software layer is connected. Ningde Shidai has integrated the software systems on the DC and AC sides of energy storage, enabling deep collaboration among the BMS, EMS, TMS (Thermal Management System), and AC-side control capabilities. Relying on the understanding of cell mechanisms, life boundaries, and operational data, it links battery status, charge/discharge strategies, and temperature control, ensuring that software decisions match hardware capabilities. Subsequently, this system will undergo further iterative upgrades, integrating with the station-level control system to coordinate energy optimization and fast power response, better supporting reliable interaction between the energy storage power station and the power grid.
Wu Dianfeng introduced a new energy project in South Africa as an example. The project signed a 20-year power purchase agreement, requiring continuous power supply from 5:00 to 21:30 every day, responding to grid dispatch, and providing stable support. The 158 sets of energy storage equipment provided by Ningde Shidai achieved collaborative operation and precise power response under the unified dispatch of the energy management system, supporting long-term performance with system-level delivery capabilities.
Quality Is Not a Cost, But a Multiplier for IRR
"Energy storage is essentially the customer's investment asset—cash is invested through energy storage equipment and recovered through asset returns." Wu Dianfeng pointed out that when designing cells and energy storage products, Ningde Shidai has only one first principle: the customer's total lifecycle return. SOH curves, RTE efficiency, and availability are not just performance parameters, but systems engineering that directly determines how much money the customer can make in the future.
For downstream customers, this is the Internal Rate of Return (IRR). Ren Feng, CEO of Shenzhen Huagong Energy, calculated the accounts more straightforwardly: energy storage is essentially an investment behavior, and there is only one gold standard for measurement—the return rate. In the financial model of energy storage projects, the impact of equipment performance differences of Ningde Shidai on the return rate is geometric. There are 8 indicators strongly correlated with IRR, including available capacity, degradation curve, effective depth of discharge, and on-time commissioning. If each of these 8 indicators is 5 percentage points higher than competitors, the cumulative effect exceeds 47%.
Additionally, according to Ren Feng, their self-invested project adopting Ningde Shidai's solution has been running for nearly three years. Under daily operation at 100% Depth of Discharge (DOD), the capacity retention still outperforms the contract specifications. He emphasized that equipment performance is a one-time, underlying genetic issue; once chosen incorrectly and the financial model is breached, sunk costs cannot be compensated by trading capabilities.
"When doing energy storage, one must know how to choose; choice is greater than effort." Wang Kun, Chairman of Nanjing Sixiang New Energy and Jiangsu Guosheng Chuangrong New Energy, also stated that energy storage investment requires choosing both the right market and the right equipment. The performance differences of different equipment will affect investment returns at different stages of project construction and operation. Since 2017, the company has continuously chosen Ningde Shidai's cells and maintained close cooperation in fields such as commercial and industrial energy storage and independent energy storage. Taking the Tongliao project as an example, he introduced that both parties advanced the preparation work for delivery, commissioning, and grid connection, pushing the project to complete grid connection and commercial operation in less than half a year, 20 days ahead of schedule. Now, with the grid connection window becoming increasingly tight, missing the window could result in the loss of months of operating income, so reliable products and delivery capabilities thus have direct economic value.
Grid-Forming Capability Is Not a Solo Show for PCS; Batteries Also Have a Say
"Grid-forming technology will become a mandatory option for grid connection standards in the vast majority of countries in the future." During the group interview with the media, Wu Dianfeng stated that this stems from the power grid moving towards power electronics. Currently, many grid-forming technologies mainly rely on PCS, but in terms of control algorithms, the PI logic of PCS usually only controls the AC-side frequency and voltage at small grid connection points. Ningde Shidai plans to introduce grid-forming control algorithms different from the industry in the future.
Why can battery companies make grid-forming products? He believes that grid-forming capability is not the natural result of self-developed PCS, but the result of joint optimization of cell status and power control. The potential advantage of Ningde Shidai is the ability to write cell understanding into the control logic to maximize the value of energy storage throughout its lifecycle. The SOC, temperature, internal resistance, consistency, available power, and aging degree of the cells determine what the DC side can provide to the PCS; the voltage source control, frequency support, and fault ride-through of the PCS must operate within these boundaries.
Only by understanding the power grid can energy storage create value. US ISO rules vary; Europe needs inertia and primary frequency regulation; the Middle East requires high-temperature resistance and continuous output; South Africa has a weak power grid with frequent power outages. Facing the differentiated demands of regional power grids globally, Ningde Shidai copes with two major capabilities:
- First, establishing a dedicated power grid technology department and simulation team to simulate and reproduce 99% of grid interaction problems in advance before project grid connection, improving grid connection efficiency and avoiding customers' revenue recognition being delayed by months due to missing the grid connection window;
- Second, Ningde Shidai divides control functions based on energy scheduling into PMS (directly connecting to the power grid with 1-2 millisecond fast control response) and EMS responsible for slow strategies, and integrates cell life models and SOH into software algorithms. Under the condition that the power at the grid connection point meets requirements, it optimizes internal distribution according to battery characteristics, allowing customers to obtain the best return throughout the lifecycle.
Sodium Batteries Are Not a Spare Tire, But a Long-Term Energy Storage Route
Discussing the opportunities for sodium-ion battery energy storage, Wu Dianfeng revealed that currently, an overseas wind power customer is quite interested in sodium-ion batteries. The PPA (Power Purchase Agreement) they signed is for 25 years. Sodium-ion batteries have a long cycle life, which can truly achieve the same lifespan for wind and storage.
His confidence in sodium-ion battery energy storage mainly comes from four aspects: sodium-ion battery raw materials are cheaper; they do not require copper foil, using only aluminum foil; and their wide-temperature characteristics can operate from -40°C to 60°C. In the context of countries pursuing energy independence, the self-sufficiency attribute of sodium resources is also more friendly than lithium.
In addition, based on the obvious voltage difference between sodium-ion batteries and lithium batteries, the answer for Ningde Shidai's Tianheng energy storage system is to adopt an architecture separating the energy cabin and the power cabin, equipped with a Bi-DC bidirectional voltage control system and a dedicated BMS tailored for sodium-ion battery characteristics. As a result, the whole-station RTE is increased by nearly 2%.
Ningde Shidai has started calculating the return rate for sodium-ion battery energy storage. Combined with Gansu Province's energy storage revenue policy, under the assumption that the total project investment is controlled within approximately CNY 1/Wh, and calculated based on the long-cycle operation of sodium-ion batteries, the project IRR can approach 10%.
This is precisely where Ningde Shidai's advantage lies: exchanging ten years of experience for mastery of the underlying cell parameters and characteristics of sodium-ion batteries. Similar to the design logic of lithium battery energy storage systems, sodium-ion systems are designed layer by layer from the bottom up. Only when the bottom layer is clearly understood can one know how to proceed with the upper layers.
Energy Storage Empirical Testing Measures Not Components, But Asset Value
How to obtain credible verification of energy storage system capabilities is the core topic of Ningde Shidai's Xiamen event. According to Chen Xiaobo, Dean of the Xiamen Empirical Energy Storage Technology Research Institute, energy storage empirical verification needs to move from the component level to full-scale, whole-station-level verification, proactively restoring the power grid operation architecture and application scenarios, identifying the system's performance and safety boundaries, so that risks can be discovered in advance, operational performance can be verified, and revenue calculations can be based on solid evidence.
A battery passing the test does not mean the whole station has no problems. How the cooling pipelines and electrical components are laid out, and how the control logic coordinates with switching operations, are only exposed when the system is assembled; extreme working conditions cannot be created on-site, and one cannot deliberately cause power grid faults just for verification. What the laboratory does is to controllably and repeatedly restore these scenarios, pushing problems to be resolved before delivery.
The 1.4GWh high-altitude energy storage project in Tibet is an example: low air pressure, large temperature differences, and wind and sand pose special requirements for equipment insulation, heat dissipation, and environmental adaptability. The research institute introduced plateau environmental conditions into the laboratory to carry out verifications such as energy efficiency, thermal management, insulation withstand voltage, and sand and dust prevention. In the testing of another gigawatt-hour-level energy storage project, empirical testing discovered high-voltage breakdown issues under overvoltage conditions in advance, providing a basis for design improvements and reducing the risk of hidden dangers entering actual power stations.
On this basis, the research institute promotes "platform-based empirical verification" and "scenario-based empirical verification": platform-based empirical verification establishes a complete verification system around system functions, grid connection safety, and reliability; scenario-based empirical verification further verifies capabilities such as grid-forming support, data center power supply, and grid-connected/off-grid switching for different regions and application needs. Actual measurement data can also be used to verify and refine simulation models, improving the accuracy of fault reproduction and system optimization.
All of these ultimately fall on assets: the black box is opened, performance, lifespan, and degradation are visible, and only then can the 20-year cash flow be calculated with confidence. The research institute is negotiating cooperation with the industrial chain and financial and insurance institutions, aiming to transform common issues into standards and design specifications—only when this step is achieved can verification be truly connected to financing.
All of these point to the asset value of energy storage: transforming energy storage from a relatively difficult-to-verify black box into an asset with transparent performance, verifiable lifespan, fully verifiable degradation, and easier pricing of future cash flows. The Xiamen Empirical Research Institute is promoting exactly this step, pushing empirical data into the investment, financing, and risk pricing of financial institutions, and planning to unite finance, insurance, EPC, and operators to create "equipment + assets + insurance + operation."
Expert Insights on Energy Storage Summary:
Ningde Shidai set the theme of this Open Month as "Quality," which translates to a track change in business: what is to be sold is not just energy storage batteries and systems, but also the certainty of returns for this system over twenty years. It can be seen that Ningde Shidai's energy storage business positioning is transforming from a single equipment supplier to an energy storage asset solution provider.
In the second half of energy storage, the focus is shifting from competing on equipment prices to power stations making money. The reliability of energy storage systems, operational capabilities, and total lifecycle return capabilities are becoming the new core.
Of course, shifting from selling equipment to selling asset solutions means the extension of capability boundaries. Power market trading, financial product design, power station operation and maintenance management—these fields that were previously out of the range of battery manufacturers now all need to be made up.
And if this model is truly successfully implemented, what latecomers need to catch up with will no longer be a single production line, but a complete set of capabilities from manufacturing to finance. By that time, the moat will no longer be capacity and cost advantages, but something that others cannot learn in the short term and is difficult to quickly replicate.
Note: The content of this article is only a compilation of public information in the energy storage industry, industrial research, and objective analysis. The listed companies mentioned in the text are only for reference as industrial chain cases and do not constitute any investment basis. The market has risks, and investment requires caution.