CATL Chairman Urges Beijing to Review Energy Storage Standards

Article content

(Bloomberg) — Contemporary Amperex Technology Co. Ltd. is placing energy storage systems front and center of its priorities for 2023, with billionaire Chairman Zeng Yuqun calling on the Chinese government to step up safety and quality standards.

Article content

CATL, in a company statement released earlier this week, urged a raft of comprehensive reforms and “nuclear power levels” of supervision. The world’s biggest maker of batteries for electric cars is interested in using cells for energy storage because of the sector’s high profit margin potential.

Article content

“In recent years, the domestic battery energy storage industry has grown rapidly but the products are of inconsistent quality, providing new safety and reliability challenges to the grid-connected operations of large capacity battery storage systems,” Zeng wrote. Zeng is a representative of the Chinese People’s Political Consultative Conference, an advisory body of party delegates and executives from the arts, business and legal worlds.

Article content

Beijing has made energy storage systems a priority in China’s 14th five-year economic plan and they also play a key part in the nation’s green push. The systems are units that contain voluminous amounts of batteries, enabling them to capture and store energy and release it for later use.

Energy storage emerged in 2021 as one of the fastest growing revenue segments of CATL’s empire, equal to about 11% of the battery making giant’s business from almost nothing a few years earlier. The Tesla Inc. supplier’s gross margin on energy storage was around 29% compared to 22% for EV batteries.

Read more: World’s Top Battery Maker Urges China to Secure Lithium

Zeng in his submission also called upon energy storage systems providers to be held to high international standards to help secure major contracts.

Last year, Zeng called on China to strengthen its lithium supply chain, a key ingredient for EV batteries. Fast forward 12 months, and lithium’s price has collapsed after a surge fueled by growing demand for electric cars.

—With assistance from Chunying Zhang.