Thanks to strategic positioning in solar-storage business segments, Sungrow achieved strong profitability of 7.7 billion yuan in the first half of this year, with the company's market capitalization recently surpassing the 300 billion yuan milestone. This makes Sungrow the third listed company in the solar industry to exceed 300 billion yuan market cap, following Longi Green Energy Technology Co.,Ltd. and Tongwei.
Currently, solar-storage integration is becoming a standard configuration for solar industry companies. Beyond early adopters like Canadian Solar and Trina Solar, Longi Green Energy Technology Co.,Ltd. has recently been rumored to be acquiring energy storage companies.
Industry professionals believe that China will appropriately relax spot market price limits in the future. When electricity price differentials widen, solar-plus-storage configurations will be able to maximize their value proposition. Additionally, scenarios with high self-consumption requirements urgently need storage solutions, providing demand scenarios for solar-storage integration.
Overall, while the solar industry fundamentals show improvement, they remain challenging. Multiple industry experts believe that the development of solar-storage integration business, particularly energy storage, is becoming crucial for solar companies to overcome difficulties and create new growth trajectories. However, companies that are inadequately prepared and rashly enter the highly competitive energy storage sector may struggle to achieve profitability in the short term.
**Solar-Storage Integration Becomes Standard**
Recently, reports emerged that Longi Green Energy Technology Co.,Ltd. has invested in energy storage company Suzhou Jincon Energy Technology Co., Ltd., while simultaneously engaging with and considering the acquisition of another energy storage enterprise.
"We continue to evaluate our energy storage business layout, but specific results remain unclear," a Longi Green Energy Technology Co.,Ltd. representative stated regarding these energy storage expansion rumors. However, industry experts view Longi Green Energy Technology Co.,Ltd.'s entry into energy storage as beneficial for advancing the company's solar-storage integration and achieving systematic coordination between solar generation and energy storage.
This isn't the first time rumors have surfaced about Longi Green Energy Technology Co.,Ltd.'s energy storage business expansion. During a research activity last November, the company responded that regarding new business areas, Longi Green Energy Technology Co.,Ltd. remained firmly supportive of hydrogen energy development, while "regarding energy storage, we haven't formed clear decisions yet and are still conducting internal evaluation and research."
While Longi Green Energy Technology Co.,Ltd.'s solar-storage integration layout awaits further verification, solar-storage integration has become standard for numerous solar companies.
According to Canadian Solar's disclosures, by the end of the first half, the company's energy storage systems had signed contracts with orders totaling $3 billion. The company expects third-quarter energy storage shipments of 2.1-2.3 GWh, with full-year shipments reaching 7-9 GWh. Energy storage business gross margins continue to lead the industry, becoming the core engine for profit growth.
Additionally, Jinko Energy stated it will continue pursuing its full-year 6GWh shipment target while simultaneously advancing global deployment of integrated solar-storage solutions. According to Trina Solar's interim report, the company holds energy storage orders exceeding 10GWh, with overseas orders comprising a significant portion. In mid-September, Trina Solar announced that Trina Storage signed energy storage product sales contracts totaling 2.48GWh with three clients across China, Latin America, and Asia-Pacific regions, with 1GWh of overseas orders utilizing grid-forming systems.
In the view of Yue Fen, Deputy Secretary-General and Associate Researcher at China Energy Storage Alliance, solar companies possess natural advantages in entering the energy storage sector, supported by three core factors: First, highly overlapping customer bases - both solar and energy storage primarily serve power generation companies and large industrial users, enabling solar companies to leverage existing customer resources and market channels; Second, strongly bound demand scenarios - energy storage is a rigid requirement for renewable energy integration, with one core application being smoothing output fluctuations from solar and other renewables, directly improving renewable energy utilization efficiency and forming functional complementarity with the solar industry; Third, overlapping technological foundations - both require power conversion systems (PCS), allowing solar companies to create synergies in related technology R&D and supply chain management.
"Energy storage systems effectively address solar integration and grid stability issues, making their combination an inevitable choice for energy transition," Yang Bao, President of Trina Solar's Energy Storage Division and Vice President of the Solar Products Division, told reporters that comprehensive renewable energy market entry is driving energy storage from policy support toward market-based trading, making solar-storage coordination unstoppable. Simultaneously, technological progress and cost reductions in both solar and energy storage have created conditions for integrated development.
**Stabilizing Renewable Energy Price Volatility**
What market pain points does solar-storage integration address, and where should solar companies focus their solar-storage integration efforts?
Yue Fen analyzes that on the generation side, as renewable energy gradually enters markets with full electricity volumes, solar power will likely experience zero or negative pricing during midday generation peaks. Currently, through policy arrangements like mechanism electricity volumes and prices, solar projects in some provinces can maintain reasonable returns. However, if such mechanism support is eliminated in the future, solar projects must either curtail power or utilize paired energy storage to shift midday low-price generation to evening peak high-price periods, with this model's economics fundamentally dependent on peak-valley price differentials.
She predicts that the "Notice on Further Deepening Electricity Spot Market Construction" (Document 136) clearly states "appropriately relaxing spot market price limits in the future." This policy direction will further widen peak-valley price differentials, allowing solar-plus-storage models to maximize their economic value under this backdrop.
From the user side, national-level policies for green electricity direct connection and zero-carbon industrial park construction have been successively introduced this year, opening new scenarios for energy storage development. Taking green electricity direct connection projects as an example, policies clearly require: renewable energy annual self-consumption must comprise no less than 60% of total available generation and no less than 30% of total electricity consumption; with continuous improvement in self-consumption ratios, targeting no less than 35% for new projects by 2030.
"High standards for green electricity utilization will catalyze demand for high-proportion energy storage system configurations, opening new growth space for the energy storage industry. Meanwhile, export-oriented companies' carbon reduction compliance needs will further drive their participation in green electricity direct connection or zero-carbon industrial park construction," Yue Fen added.
"As renewable energy proportions increase, grid stability requirements grow increasingly stringent. Energy storage, as the key solution for addressing solar generation intermittency and volatility issues, naturally tends toward deep integration with the solar industry," Yang Bao also mentioned that application scenarios are becoming increasingly diverse, with achieving solar-storage coordinated development through microgrids, zero-carbon industrial parks, and solar-storage charging stations becoming widespread industry consensus.
Regarding high self-consumption demand, the executive cited Hubei Province's clear requirement that annual self-consumption of commercial and industrial rooftop solar must principally exceed 50%, encouraging project entities to improve self-consumption ratios through solar-storage coordination and other methods.
In Yang Bao's view, strengthening technological innovation and constructing a high-quality development system integrating technology R&D, intellectual property, and industry standards is particularly crucial for solar companies entering solar-storage businesses.
"Solar-storage systems aren't simple products, but comprehensive solutions," Yang Bao explained that companies need high-level technological innovation to meet regional special requirements like grid-forming capabilities, high-temperature resistance, and long cycling, as well as diverse market demands. Using Trina Solar as an example, the company has comprehensively transitioned toward solutions strategy this year, leveraging technological advantages and product leadership to provide comprehensive solutions for users.
Notably, policy-driven "mandatory storage" is gradually giving way to economics-led approaches, meaning companies must focus more on actual project economic benefits and create genuine high value for customers.
**Key to Weathering Cycles**
While the solar industry remains in a cyclical downturn with major product prices still at low levels and industry-wide profit recovery premature, companies that positioned early in solar-storage integration businesses are already reaping benefits.
For example, Sungrow maintained rapid growth momentum in the first half of this year, achieving operating revenue of 43.5 billion yuan (up 40% year-over-year) and net profit attributable to shareholders of 7.7 billion yuan (up 56% year-over-year). The company attributed primary profit contributions to solar inverters and energy storage businesses.
Canadian Solar was also among the few solar companies achieving profitability in the first half, with business resilience mainly stemming from strategic choices in solar business and breakthrough in energy storage as a second growth curve. During the period, delivered energy storage systems reached 3.1GWh (including residential storage), with second-quarter energy storage deliveries reaching 2.2GWh, up over 140% quarter-over-quarter.
Discussing differentiated advantages in solar-storage integration business, Yang Bao highlighted the company's full-stack technical capabilities and scenario-based solutions, robust global localized service networks, and forward-looking innovation and sustainable development positioning. System integration and global delivery have also received authoritative institutional recognition. Regarding business philosophy, the company focuses on improving overall project returns through solar-storage integration to meet market-based demands, such as the "wind-solar-storage collaborative desertification control" flagship project in Qinghai that precisely meets customer needs.
Yue Fen noted that both solar and energy storage industries currently face intense competition, but leading energy storage companies maintain strong profitability through technological and scale advantages, while smaller enterprises have fallen into losses. "Currently, whether companies focus solely on solar or energy storage businesses, all are actively expanding into comprehensive energy services, virtual power plant operations, electricity market trading and other extended businesses, hoping to somewhat hedge against industry cyclical volatility risks."
However, she cautioned that companies with insufficient technological reserves or inadequate understanding of core factors like markets and policies may struggle to achieve profitability in the short term if they rashly enter the highly competitive energy storage sector.
"As solar-storage integration economics gradually emerge, solar-storage integration becomes a strategic direction for solar companies to break free from low-price competition difficulties. Solar-storage integration is becoming a key pathway for the industry to weather cycles and achieve sustainable development. Companies demonstrate positive contributions from energy storage business to profits and operations through forward-looking positioning," Yang Bao stated.
Currently, domestic and international solar-storage markets show positive signals. Domestically, supporting policies for Document 136 are being successively introduced across provinces, improving large-scale storage profitability models with demand drivers shifting from mandatory policy storage toward economics-led approaches. Particularly in August, energy storage system/EPC procurement reached 69.4GWh, setting a single-month record and confirming rigid demand and high growth.
Overseas solar-storage markets also show upward momentum. Sungrow estimates conservative 20% compound annual growth rates for global energy storage in coming years, with optimistic projections reaching 30%. European markets show strong demand for both large-scale and commercial-industrial storage in healthy competitive conditions; US markets have subsidies extending until 2033 with favorable energy storage economics; additionally, Australia expects 10GWh energy storage demand by 2026 with strong growth.
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