China's energy storage industry needs to be tempted by VCs

In stark contrast to the increasingly clear market demand and technological breakthroughs in the energy storage industry, the loneliness of venture capital. The problem of financing difficulties and financing has become a major problem in the development of the energy storage industry. China's energy storage industry is in urgent need of a "single foot".

On the one hand , with the distributed photovoltaic microgrid policy, power demand side management compensation electricity price policy, power auxiliary service market policy, peaking electricity price and compensation policy, China's energy storage market business model is gradually taking shape. The industry believes that huge energy storage needs will be opened in the fields of new energy microgrid, competitive power sales, incremental distribution network transformation, vehicle interconnection and electric vehicle charging stations. According to the conservative forecast of the Zhongguancun Energy Storage Industry Technology Alliance, by the end of 2020, the cumulative installed capacity of China's energy storage projects will reach 14.5 GW.

On the other hand , energy storage technology continues to achieve breakthroughs. In 2016, China's energy storage industry not only made a lot of breakthroughs in the performance improvement of liquid flow batteries, lithium ion batteries , sodium nickel batteries, compressed air, phase change heat storage technology, but also all solid state batteries, lithium sulfur batteries, lithium air. Many new technologies such as batteries, liquid metal batteries, and P2G (electric steam) have also made great progress.

However, in terms of financing, the Chinese energy storage industry, which is in the turmoil, has shown incredible loneliness. According to incomplete statistics, in 2016, there were only 20 investment and financing projects in China's capital market energy storage industry, and the financing amount just exceeded 10 billion yuan.

The reporter found that the financing of China's energy storage industry is more active in the secondary capital market, and is concentrated in mergers and acquisitions between enterprises. In the Tier 1 capital market, there are very few start-up energy storage companies that can get the attention of venture capital institutions.

In contrast, the financing situation of the international energy storage market is significantly better than that of China. According to relevant statistics, in 2016, a total of 17 companies around the world completed financing or were acquired through financing and selling bonds/equity. The financing scale reached US$1.02 billion, an increase of 155% compared with the previous year. The new financing is mainly used to improve the performance of existing products, develop new technologies, develop new products, deploy new projects, and expand new business and new markets.