CATL expects energy storage to become half of total business by 2030

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Battery maker CATL expects energy storage systems to account for 50 per cent of its total sales by 2030, up from about 25 per cent currently, according to Kevin Tang, the company's Director for Energy Storage Systems in Europe.

Tang said the growth reflects rising demand for battery storage as countries continue investing in renewable energy.

Battery storage is gaining greater importance for industries that require a continuous power supply, including aluminium production. As renewable energy use grows, batteries can store electricity generated from solar and wind projects and supply power when generation is unavailable, such as during night-time hours or periods of low wind.

 As Europe, China and other regions continue investing in solar and wind power, battery storage has become an increasingly important part of energy infrastructure.

China, CATL's home market, has also expanded investment in battery storage as it seeks to reduce the curtailment of surplus renewable power during periods of lower electricity demand.

Kevin Tang, CATL's Director for Energy Storage Systems in Europe, told Reuters that the company's energy storage business could account for 50 per cent of total sales by 2030, compared with around 25 per cent currently.

Tang said the growth is being driven by the increasing share of renewable energy in electricity systems.

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Battery storage has become an important tool for balancing electricity grids that rely heavily on wind and solar power. Unlike conventional baseload power generation, renewable sources only produce electricity when weather conditions are favourable. Batteries allow excess electricity to be stored and used when demand rises, or renewable generation falls.

Germany provides one example of the challenge. According to the report, the country curtailed 3.1 per cent of its solar power generation last year because demand was insufficient during periods of peak production. Combined with unused wind power, total curtailed renewable generation reached 9.6 terawatt-hours.

Though demand is rising rapidly, battery storage deployment continues to face challenges related to project costs, profitability and land requirements. Battery manufacturing costs have declined significantly over the past decade, but large-scale storage projects still require substantial investment.

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To address the issue, regulators in Europe have increasingly encouraged the integration of battery storage with renewable energy projects to reduce curtailment and improve grid stability.

The growing role of storage has supported CATL's expansion in Europe. The company currently operates battery factories in Germany and Hungary and is constructing a third facility in Spain.

The sector has also attracted interest from energy trading companies. Firms including Vitol and Trafigura are investing in battery storage projects across Western Europe as electricity markets experience greater price volatility linked to renewable energy generation.

Tang said higher raw material and energy costs remain a challenge for the industry. However, he noted that these pressures are expected to ease over time as supply chains continue to mature.