Author | Ma Shiqing Editor | Ma Guangyu
"Over the next decade, the world will add over 1,000 GW of grid-forming energy storage capacity," predicted energy consulting firm Wood Mackenzie.
This is truly an imaginative blue ocean, and Chinese companies have already taken the lead in seizing the beachhead. In mid-August, Hithium announced the signing of an order for a 421 MWh grid-forming energy storage system in Queensland, Australia. Its spokesperson made no secret of the optimism regarding this technology, pointing out that it not only enhances grid operational stability but also supports the large-scale grid integration and consumption of green power.
The Hithium project in Australia is just a microcosm. Since the beginning of this year, Chinese companies have been capturing markets and concentrating on promoting grid-forming energy storage projects:
Huawei Digital Power signed a memorandum of understanding with AIS in Egypt to produce grid-forming battery energy storage systems in Egypt; Sungrow signed a contract with Masdar in the UAE for a liquid-cooled energy storage system equipped with grid-forming technology. Grid-forming energy storage projects implemented in Inner Mongolia, Tibet, and Xinjiang are even more ubiquitous.
Multiple industry insiders told Leifeng Network: Currently, the proportion of new energy power generation installed capacity is getting higher and higher. The equipment connected to the grid must be grid-supporting and grid-friendly. The application of grid-forming technology is inevitable.
Driven by the market explosion and strong demand, what exactly is the value of applying grid-forming technology to energy storage? Facing the hot global market, how are the competitive advantages of Chinese companies reflected?
01Why Is Grid-Forming Energy Storage in Such High Demand?
To understand grid-forming energy storage, one must first understand the "heart" of the energy storage system: the Power Conversion System (PCS). As a bridge connecting batteries to the grid or other power facilities, the PCS completes the conversion between DC and AC power during the charging and discharging processes.
In addition, the PCS undertakes many critical functions, such as stabilizing output voltage and frequency, controlling charging and discharging power, and realizing grid-connected and off-grid switching. According to institutional estimates, this component accounts for about 15% to 20% of the total cost of the energy storage system.
PCS operates in two modes: "grid-forming" and "grid-following," with the "grid-following" mode previously dominating the market.
Simply put, grid-following energy storage needs to "follow the grid's lead" to operate, requiring a stable grid to function normally. Once disturbances occur in grid voltage or frequency, it is prone to tripping and disconnecting from the grid, completely failing at the critical moment.
In the era dominated by thermal power generation and a stable grid structure, grid-following energy storage was still competent. But in the era where new energy power generation takes the lead, the situation is different.
"Electricity Mid-Year Update 2026"
Data from the International Energy Agency (IEA) shows that global renewable energy power generation is expected to exceed coal-fired power generation by 2026. The high proportion of new energy power generation brings instability, turning the grid into a "weak grid" with extremely poor anti-interference capabilities. At this point, grid-following energy storage, which can only follow the grid's lead, is no longer able to shoulder the main responsibility alone, and the grid-connection bottleneck is being infinitely amplified.
Against this backdrop, the value of grid-forming energy storage stands out: it does not rely on the external grid, possesses complete voltage source characteristics, can independently establish voltage and frequency, and actively supports the grid; at the same time, it has "black start" capabilities, enabling it to independently build local microgrids to restore power supply during a grid collapse, turning the tide.
Not only is the technical feasibility verifiable, but the policy side is also accelerating the implementation of grid-forming energy storage.
Since last year, catalyzed by the major blackout in Spain, the European Union has advanced the "Network Code on Requirements for Generators," listing grid-forming technology as a mandatory requirement for energy storage projects over 1 MW. China has also clarified the goal of achieving a 30% penetration rate for grid-forming energy storage, and even in the northwest region, which is dense with new energy, requires new projects to be equipped with grid-forming capabilities as standard.
If the rise in global new energy penetration rate is the core reason for the explosion of grid-forming energy storage, then the explosion of AI Data Centers (AIDC) is the catalyst.
AIDCs feature high-power and strongly fluctuating load characteristics, placing nearly harsh requirements on power supply continuity. Grid-forming energy storage can quickly respond to sudden load changes, smooth power fluctuations, reduce the impact on the grid, and provide millisecond-level disaster backup power. This is critical for AI large model training, because a momentary power outage could reset weeks of training tasks to zero.
Since the beginning of this year, major new energy companies have successively released new energy storage products suitable for AIDCs at exhibitions, many of which are solutions equipped with grid-forming technology. However, most products currently remain at the stage of public relations promotion and track seizing, and have not yet entered the empirical verification stage.
Lin Xing, a practitioner in the energy industry, revealed to Leifeng Network: "The implementation of grid-forming technology must go through national standards, simulation, and third-party project field tests. Currently, very few companies have truly achieved this. Domestically, a test report from the China Electric Power Research Institute (CEPRI) is generally required, while overseas, it is generally the TÜV SÜD certification."
Although there are currently few implementation cases in AIDC scenarios, the trend of technological shift has become an industry consensus.
Tian Pan, an executive at an underwater data center service provider, previously told Leifeng Network straightforwardly: "Most of our current systems still use grid-following energy storage, but we will definitely shift to grid-forming in the future. As the proportion of new energy power generation gets higher and higher, the inertia of the grid itself is insufficient, and it needs to be supported by grid-forming energy storage. Even if the external grid loses power, it can achieve a black start. This is a major technological breakthrough, and I believe the proportion of grid-forming energy storage will gradually increase."
However, the booming trend does not mean that all companies can get a share of the pie; manufacturers with different backgrounds and capabilities will compete here.
02Do Manufacturers with a Power Electronics Background Have Significant Advantages?
If the core capabilities of energy storage companies are regarded as a pyramid, it can be divided into three layers. The first layer is the cell level, represented by new energy giants such as CATL, EVE Energy, and Hithium; the second layer is the power electronics technology responsible for energy conversion and control, represented by companies such as Huawei Digital Power and Sungrow; the third layer is the energy management system that determines grid adaptability and revenue, focusing on AI algorithms and power market trading.
Zhou Tao, President of the Smart PV Product Line at Huawei Digital Power, once said in an interview that so-called "grid-forming" is essentially about maximizing the ability of power electronics equipment to support the grid.
Precisely because of this, companies with a power electronics technology background show a natural fit with grid-forming technology. Manufacturers represented by Huawei Digital Power and Sungrow have accumulated experience in the field of power electronics, are familiar with the complex grid environment under high-proportion new energy grid connection, and rely on algorithms to quickly respond to voltage and frequency fluctuations, providing support capabilities.
Multiple practitioners told Leifeng Network that Huawei Digital Power and Sungrow are relatively close in their ecological niches. However, according to observations, in specific implementation projects, especially overseas, the two companies still have certain differences based on their own genes and the external environment:
Sungrow is one of the few Chinese integrators that can deeply penetrate the core utility grid in Australia. At the end of last year, its 200 MW/400 MWh grid-forming energy storage project at Pelican Point in South Australia, Australia, commenced construction. Currently, Sungrow holds a high share in the European market. In addition, its energy storage factory in Egypt recently broke ground, promoting the localization of production capacity.
Huawei Digital Power's overseas projects cover regions such as the Middle East, Latin America, Asia-Pacific, and Europe. Leifeng Network learned that last year, Huawei's cooperative project with SchneiTec verified Huawei's smart string grid-forming energy storage technology, passed the TÜV SÜD certification, and verified its capabilities in inertia response, high and low voltage ride-through, frequency support, and overload. This is also Cambodia's first 1 GWh grid-forming energy storage power station.
Even earlier, Huawei Digital Power deployed a 400 MW PV + 1.3 GWh grid-forming energy storage project in the Red Sea, Saudi Arabia.
According to the introduction, during the project's operation, more than a dozen transformer switching tests were conducted, achieving stable operation without disconnecting from the grid, ensuring the stability of the main grid; in addition, a test of GWh-level whole-station synchronous black start within 10 minutes over a 100-kilometer transmission line was completed.
Speaking of the differences between Huawei and Sungrow, the aforementioned energy industry practitioner Lin Xing told Leifeng Network: "Relying on the group's capabilities, Huawei Digital Power has some advantages in basic research, such as chips and algorithms; at the same time, Sungrow's organization is not as massive as Huawei's, which may make it slightly more flexible."
Meanwhile, CATL, often referred to as "Ning Wang", is also accelerating the expansion of its capabilities in the field of power electronics.
A few days ago, CATL announced its plan to invest approximately 4.1 billion RMB to increase its capital in Zhongheng Electric, valuing its 99.6970% equity in its subsidiary Shidai Tianyuan at approximately 1.196 billion RMB. Zhongheng Electric is deeply engaged in data center HVDC (High Voltage Direct Current) power supply systems, while the core product of Shidai Tianyuan is precisely energy storage PCS. Through resource integration, CATL aims to increase its layout in the field of power electronics.
From the stable operation of the GWh-level project in the Red Sea, Saudi Arabia, to the advancement and signing of large orders around the world today. On the one hand, this shows that the demand for grid-forming technology is becoming increasingly rigid against the backdrop of energy transition; on the other hand, it shows that the capabilities of Chinese companies in the field of grid-forming energy storage have been verified.
Moving from grid-following to grid-forming is not a simple technological iteration, but a role transformation. Grid-following energy storage only passively responds to the grid, while grid-forming energy storage, because it can actively construct voltage and frequency, has already become a pillar supporting the stable operation of the power system.
As the global new energy penetration rate increases, coupled with the requirements of the AI computing power explosion for high-quality, uninterrupted power, grid-forming capability has evolved into an entry threshold for power grids in multiple countries. The dimensions of industry competition will also be comprehensively upgraded: from simply competing in cell performance and cost, to a comprehensive contest including power electronics technology, control algorithms, and localized delivery capabilities.
Chinese companies represented by Huawei Digital Power and Sungrow are building their moats through continuous technological verification and project track records, becoming the core force in the construction of new power systems in the tide of global energy transition.