The long-duration energy storage sector, valued in the hundreds of billions, presents a golden opportunity. The entire all-vanadium flow battery industry chain is undergoing a fundamental value reassessment.
1. A Fundamental Inflection Point and the Vanadium Revaluation Cycle
A pivotal shift in the industry's fundamentals has arrived, marking the start of a vanadium revaluation cycle. The Xinjiang Jimsar 200MW/1000MWh project, China's largest all-vanadium flow battery power station, is now operational. With a total investment exceeding 1.9 billion yuan, this signifies the industry's definitive move beyond pilot projects into a new phase of scaled, commercial deployment. Vanadium resources have transitioned from being a supplementary material in the steel industry to a core primary material for long-duration energy storage. This mirrors the earlier transformation of lithium from a ceramic raw material to a key resource for power batteries, laying a solid foundation for earnings growth across the entire industry chain. The underlying supply-demand dynamics point to a clear long-term upward trajectory. Supply is highly inelastic. Over 60% of domestic vanadium output is a by-product of vanadium-titanium magnetite, with by-products from chromium salt and primary vanadium mines contributing a smaller share. New primary vanadium mines take 5-8 years to come online, making supply expansion difficult to match demand growth. Demand is exhibiting explosive growth characteristics. In Q1 2026, new vanadium battery installations surged 586% year-over-year. Institutional analysis projects that vanadium consumption for energy storage will account for 10%-15% of global total vanadium production by 2028, indicating a widening supply-demand gap. The current minor short-term pullback in vanadium pentoxide prices offers an attractive entry point for medium- to long-term positioning. The profitability loop is now complete, with both cost structures and business models aligned. The historical industry pain point of high vanadium battery costs has been fully addressed. System costs have dropped from 3.2 yuan/Wh in 2019 to 1.95 yuan/Wh by the end of 2025, a cumulative 40% reduction over six years. The triple cost-reduction drivers of stack scaling, domestic membrane material production, and improved electrolyte utilization continue to gain traction. The industry expects system costs to fall below the grid parity threshold of 1.5 yuan/Wh within 2-3 years. The electrolyte leasing model further lowers project barriers. Electrolyte constitutes about half of the total system cost and features high recyclability and zero degradation. The financial leasing model can reduce the initial investment for a power station by 30%-50%. Coupled with supportive capacity pricing policies in various regions, the revenue benefits for long-duration discharge scenarios are significant. In storage scenarios exceeding 6 hours, vanadium batteries demonstrate superior cycle life and electrolyte residual value compared to lithium-ion batteries, continuously enhancing their commercial competitiveness.
2. Upstream Vanadium Resources: The Core Sector with Highest Leverage
Upstream vanadium resource companies directly benefit from rising vanadium prices, with a clear logic of volume and price increases. The growth narratives for key players are distinct and robust.
Pangang Group Vanadium & Titanium Resources Co., Ltd. (SZSE: 000629) is the absolute leader in domestic vanadium products, commanding a market share exceeding 60%. It controls significant domestic reserves of vanadium-titanium magnetite and has an annual vanadium pentoxide production capacity of 44,200 tons. Surging demand for energy storage electrolyte will directly boost its vanadium product order book. With strong pricing power, it is positioned to be among the first to realize earnings growth from the expansion in energy storage installations.
HBIS Co., Ltd. (SZSE: 000709) is a core player in steel by-product vanadium. It produces vanadium as a by-product of its own vanadium-titanium magnetite smelting process, resulting in industry-low mining and smelting costs. As China's second-largest vanadium resource supplier, all revenue increments from vanadium price increases translate directly into pure profit, with its core steel business providing a stable operational foundation and continuously enhancing earnings leverage.
Sichuan Anning Iron and Titanium Co., Ltd. (SZSE: 002978) focuses on vanadium-titanium ore mining and processing, holding 176,000 tons of recoverable vanadium reserves. It is concurrently developing a 3,000 cubic meters/year electrolyte production line, achieving an integrated layout from mineral resources to energy storage materials. This allows it to fully capture the dual growth benefits of rising vanadium prices and electrolyte capacity expansion, placing its earnings leverage in the industry's top tier.
Lomon Billions Group Co., Ltd. (SZSE: 002601) produces vanadium as a by-product of its titanium dioxide operations. Revenue from its main titanium dioxide business is sufficient to cover all corporate operating costs, making its vanadium business essentially a cost-free, incremental revenue stream. Each round of vanadium price increases directly boosts its profits, making it one of the stocks with the highest sensitivity to vanadium prices in the entire market.
Zhenhua Chemical Co., Ltd. (SHSE: 603067) primarily produces chromium salts with vanadium as a by-product. Currently, vanadium contributes only about 1.28% of its revenue. Its stable chromium salt business covers operational expenses, meaning the vanadium business carries almost no fixed costs. Following an explosion in energy storage vanadium demand, its potential earnings growth far exceeds that of traditional vanadium resource companies.
Western Mining Co., Ltd. (SHSE: 601168) holds scarce, independently controlled primary vanadium mines with excellent resource endowments. Distinct from the mainstream by-product vanadium production model, the scarcity value of its primary vanadium resources becomes increasingly prominent against the backdrop of persistent supply tightness, allowing it to benefit long-term from the widening supply-demand gap.
Wintime Energy Co., Ltd. (SHSE: 600157) has completed a vertically integrated layout, possessing vanadium pentoxide resource reserves of 1.5889 million tons. It is simultaneously building a 300MW vanadium battery stack production line. Its stone coal vanadium extraction process offers significant cost advantages, enabling it to capture the dual benefits of the upstream resource and midstream manufacturing sectors simultaneously.
3. Midstream Manufacturing: Domestic Capacity Release and Core Component Barriers
The midstream segment connects upstream vanadium resources with downstream energy storage power station demand. Core competitive barriers lie in the mass production capability of domestic core components. With industry capacity now being deployed in a concentrated manner, the growth paths for segment leaders are clear.
Henan Yicheng New Energy Co., Ltd. (SZSE: 300080) is a leader in complete vanadium battery equipment sets. It has existing mass production capacity of 600MW and 3GW of new capacity under continuous construction. It independently researches and produces two core components: proton exchange membranes and bipolar plates, achieving full domestic production of key materials. Its ample capacity reserves position it to fully capture equipment orders driven by the large-scale construction of downstream energy storage power stations.
Chujiang New Materials Co., Ltd. (SZSE: 002171) is deeply entrenched in the core bipolar plate segment for vanadium batteries. Its self-developed high-performance composite bipolar plates have achieved batch supply. Bipolar plates directly determine stack energy efficiency. Leveraging mature metal material processing technology, the company has entered the supply chains of leading vanadium battery system manufacturers, ensuring long-term, sustained order growth.
Advanced Material Technology Co., Ltd. (SZSE: 300706) is a niche, hidden champion in special sputtering targets for electrolyte purification. Its self-developed products have entered the supply chains of several leading electrolyte producers. The competitive landscape in this niche segment is favorable, and the continuous expansion of electrolyte capacity steadily drives demand for supporting targets.
Xinde New Material Co., Ltd. (SZSE: 301349) specializes in carbon felt electrode materials for vanadium batteries. Its self-developed high-performance electrode products effectively enhance battery energy conversion efficiency and are now supplied in bulk to several mainstream vanadium battery system integrators, indicating broad incremental potential in this midstream material segment.
Shanghai Electric Group Co., Ltd. (SHSE: 601727) is a leading domestic enterprise that achieved early commercial integration of vanadium batteries. It possesses deep technical expertise in stack design and system integration, having implemented multiple national-level energy storage demonstration projects. It holds significant technological and brand advantages in large-scale energy storage power station tenders.
Yingda Co., Ltd. (SHSE: 600517), leveraging the State Grid's industrial ecosystem, holds inherent channel barriers for securing grid-side independent energy storage projects. It is deeply involved in full-chain supporting businesses for vanadium batteries. During the expansion of grid-side long-duration energy storage, its project order fulfillment pace leads industry peers.
4. Downstream Energy Storage Operations: Policy Benefits Lock in Stable Long-Term Cash Flows
Downstream companies directly implement energy storage power station projects, securing long-term, stable operational income through capacity pricing policies. This is the segment with the strongest earnings certainty post-commercialization.
China Three Gorges Renewables (Group) Co., Ltd. (SHSE: 600905) is the investment and operating entity for the landmark Jimsar gigawatt-level vanadium battery energy storage station in China. It directly benefits from the persistent, stable revenue generated by capacity pricing. It is continuously replicating large-scale vanadium flow energy storage projects nationwide and steadily advancing its integrated wind-solar-storage layout, ensuring long-term stable and controllable cash flows.
Xizi Clean Energy Equipment Manufacturing Co., Ltd. (SZSE: 002534) primarily provides EPC services for vanadium battery energy storage power stations. It has undertaken independent grid-side energy storage engineering projects in multiple provinces, possessing rich practical experience in implementing large-scale energy storage projects. Its order backlog is substantial, and the ongoing industry capacity expansion cycle drives steady, high growth in engineering revenue.
Xintian Green Energy Co., Ltd. (SHSE: 600956), as a leader in wind and solar new energy operations, deploys long-duration vanadium battery storage to complement its own wind and photovoltaic power stations. It is a core enterprise for implementing source-grid-load-storage integration scenarios. Mandatory energy storage allocation policies for new energy continue to drive the construction of supporting vanadium battery projects.
Zhiguang Electric Co., Ltd. (SZSE: 002169) is deeply involved in the entire process of energy storage investment, operation, and maintenance in the South China region, having implemented several regional benchmark vanadium battery energy storage projects. Its energy storage operation business generates stable returns, and it is continuously replicating and expanding its regional energy storage asset scale.
GCL System Integration Technology Co., Ltd. (SZSE: 002506), leveraging its integrated photovoltaic business advantages, is advancing large-scale photovoltaic projects paired with vanadium battery storage, creating comprehensive solar-plus-storage solutions. The expansion of new energy installation capacity simultaneously drives continuous growth in demand for supporting vanadium batteries.
Xinzhu Co., Ltd. (SZSE: 002480) is a core vanadium battery system integration service provider in the Southwest region. Its self-developed vanadium battery systems have been field-tested in multiple energy storage projects. The region is rich in wind and solar resources, and its local channel advantages continue to drive the implementation and scaling of regional energy storage projects.
5. Long-Term Value Summary of the Sector
The official commissioning of the large-scale Jimsar vanadium energy storage station marks the definitive exit of all-vanadium flow batteries from the pilot project cycle and their formal entry into a golden phase of scaled commercial application. Vanadium resources have shed their singular identity as a steel auxiliary material, upgrading to a core strategic resource for long-duration energy storage in the new power system. The combination of supply inelasticity and demand explosion creates a long-term structural supply-demand gap. Resonating with this are the triple tailwinds of continuous system cost reductions, innovative business models like electrolyte leasing, and supportive capacity pricing policies. The entire industry chain is poised to maintain a high-growth upward cycle over the next three to five years. Upstream vanadium resource companies fully enjoy the earnings leverage from rising vanadium prices. Midstream equipment and material manufacturers are set to capture order-driven benefits through the release of domestic capacity. Downstream energy storage operators lock in long-term stable cash flows through policy subsidies. Every link in the industry chain possesses sustained earnings growth potential, making it a high-quality allocation sector aligned with the medium- to long-term energy transition theme.
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