An investment roadmap released on September 27 by Chinese battery company EVE Energy, which has a market value of over 170 billion yuan ($23 billion), has offered further insight into the potential of the lithium industry.
EVE Energy issued a series of investment announcements yesterday. First, it plans to spend 10 billion yuan to build a 40GWh energy storage and battery project in Shenyang, to be built in two phases. In the initial phase of the project, the firm will invest 5 billion yuan (including 4 billion yuan as a fixed asset investment) to build a 20GWh energy storage and battery manufacturing plant, along with supporting facilities.
At the same time, EVE Energy plans to use 800 million yuan of its own capital to acquire Ruifu Lithium, which specializes in ore extraction of lithium battery positive raw materials, with 20% equity, and it plans to increase capital by 884 million yuan to Sichuan BTR New Material for the development of 100,000 tons of lithium battery negative materials.
This is not the first time in recent years that EVE Energy has invested in a storage project. At the end of April this year, it planned to invest 20 billion yuan in Chengdu to build a power energy storage battery production base with an annual output of 50GWh, as well as a Chengdu Research Institute. In mid-May, it announced that it plans to invest 3 billion yuan to build a 10GWh energy storage battery project in Yuxi, Yunnan Province.
In addition to the investment, in order to further improve the efficiency of new product development, EVE Energy disclosed at the beginning of June this year that it planned to invest 3 billion yuan to build an energy storage headquarters and research institute in Wuhan.
Shanghai Securities News estimates that, with the latest 10 billion yuan investment on September 27, total investment by EVE Energy in the energy storage field this year has been close to 40 billion yuan. The huge scale of investment also means that the company’s assets have been rapidly reduced. This year’s semi-annual report shows that its asset-liability ratio has increased from 35% last year to 65% this year.
EVE Energy’s rivals are also investing heavily. Sunwoda disclosed on September 15 that the 30GWh power battery base with a total investment of 12 billion yuan has landed in Nanchang. On September 16, Farasis Energy disclosed that it planned to invest in a new 24GWh lithium iron phosphate project in Yunnan Province. On September 21, Sunwoda spent another 21.3 billion yuan on the construction of a battery and energy storage project in Zhejiang Province.
“The investment by power battery manufacturers in energy storage shows the great potential of the industry,” an insider told Shanghai Securities News. These energy storage systems now fully cover the power generation field, the power grid field and the user side, said CATL on an investor interaction platform on September 27.
According to analysis by EVTank, global energy storage market shipments are expected to reach 98.2GWh in 2022, 243.7GWh in 2025, and 913.7GWh in 2030. According to Everbright Securities, the size of China’s energy storage market will reach 0.45 trillion yuan by 2025, while it will grow to about 1.3 trillion yuan by 2030.