On January 5, 2025, Zhoukou City in Henan Province officially launched the construction of a comprehensive base for the entire vanadium flow battery industry chain, with a total investment scale of 8.08 billion yuan.

     According to public information, the project is jointly invested by Dalian Hengrong New Energy Co., Ltd., CNNC Huineng Henan Energy Co., Ltd., and Zhoukou Guokong New Energy Co., Ltd. It plans to build a 500MW/2GWh all vanadium flow battery energy storage production line and supporting scientific research and demonstration power stations, aiming to form a flow battery industry chain covering technology research and development to large-scale application.

    It is expected that after the entire project is put into operation, it will achieve an annual output value of 17.26 billion yuan.

    In the past year, liquid flow energy storage has been rapidly rising. According to ESPLAZA's long-term energy storage network statistics, as of the end of 2024, there are a total of 75 flow battery production and manufacturing projects that have been signed, under construction, and put into operation nationwide, belonging to 45 flow battery related manufacturers. The technical routes involve vanadium flow batteries, zinc iron flow batteries, iron chromium flow batteries, sulfur iron flow batteries, etc.

    Against the backdrop of renewable energy gradually becoming the mainstream power generation method, how to cope with intermittent fluctuations has become a challenge facing the current energy system.

    Therefore, long-term energy storage technology has emerged as an important means to solve the consumption of new energy and improve the regulation capacity of the power grid. Long term energy storage can regulate power fluctuations over a longer period of time, improving the efficiency and stability of renewable energy utilization.

    At present, in the energy storage technology market, lithium iron phosphate batteries are mainly used for energy storage needs of 4 hours or less, while new technologies such as flow batteries and compressed air energy storage are seen as the future direction of long-term energy storage.

    These two technologies have considerable optimization potential in terms of efficiency and cost control, thus demonstrating enormous potential in addressing large-scale energy storage needs and long-term applications.

Starting from 2023, enterprises will accelerate technological innovation, starting from 16 kW single stack and gradually breaking through, and now widely using 45 kW electric stacks. Research and development continue to advance, and the 83.5 kW new generation fuel cell has entered the verification stage, with performance and efficiency reaching new heights. Currently, some companies plan to develop more advanced 125 kW fuel cells by 2025.

    In this context, the government has increased policy support for the new energy storage industry.

    For example, in May 2024, Sichuan Province jointly issued the "Implementation Plan for Promoting High Quality Development of Vanadium Battery Energy Storage Industry" with multiple departments, becoming the first policy document in China specifically promoting the development of vanadium battery energy storage technology.

    In August 2024, the National Development and Reform Commission, the National Energy Administration, and the National Data Administration jointly released the "Action Plan for Accelerating the Construction of a New Power System (2024-2027)". This plan emphasizes the construction of energy storage power stations that cover various technological routes such as flow batteries, flywheels, compressed air energy storage, carbon dioxide energy storage, and sodium ion batteries according to the needs of different application scenarios.

    On November 6, 2024, the Ministry of Industry and Information Technology publicly solicited opinions on the "Action Plan for High Quality Development of New Energy Storage Manufacturing Industry (Draft for Comments)". The draft proposes the need to implement innovative actions for new energy storage technologies and promote the development of diversified new energy storage ontology technologies. This includes sodium batteries and flow batteries.

    Subsequently, in December 2024, the Henan Provincial Government issued the "Implementation Plan for Accelerating the Integration of Source, Grid, Load and Storage in Henan Province", which clearly proposed to promote the long-term energy storage technology of flow batteries in the incremental distribution network area to meet the energy storage needs of various time scales, providing strong support for the market application of long-term energy storage technology.

    The parent company of Dalian Hengrong New Energy Co., Ltd., the investment enterprise of this expansion project, is Dalian Rongke Energy Storage Group Co., Ltd. (hereinafter referred to as "Rongke Energy Storage").

    According to public information, Rongke Energy Storage was established in 2008 and partnered with Dalian Institute of Chemical Physics, Chinese Academy of Sciences to establish its subsidiary Dalian Rongke Energy Storage Technology Development Co., Ltd., specializing in the research and development, industrialization, and market application of vanadium flow battery technology. It is one of the earliest energy technology companies in China engaged in the research and manufacturing of vanadium flow batteries.

    Rongke Energy Storage has participated in the establishment process of China's flow battery industry from scratch, and has been approved to establish the National Key Laboratory of Energy Flow Energy Storage Battery Technology and the National Local Joint Construction Engineering Research Center. It has won more than 10 scientific and technological achievements awards, including the National Technology Invention Second Prize.

    Rongke Energy Storage has previously invested in the construction of production bases in Liaoning, Sichuan, Anhui, Jiangsu and other places.

    Against the backdrop of the booming development of the flow battery industry in 2023, Rongke Energy Storage has successfully completed a Series B financing of over 1 billion yuan. This round of financing is led by Junlian Capital, with participation from Dalian Jintou, former shareholder Rongtuo Capital, and multiple other investment institutions.

    In addition, Rongke Energy Storage has signed a listing guidance agreement with Anxin Securities and plans to list on the Science and Technology Innovation Board, striving to become the first listed company in the field of all vanadium flow batteries.

    However, since 2024, the financing enthusiasm for liquid flow energy storage has sharply declined.

According to data from Great Wall Securities, as of the end of August, the domestic long-term energy storage sector, including liquid flow energy storage, has only completed 5 financing rounds, clearly falling behind the prosperous scenario of 2023.

    Some market views believe that this is because the current production capacity planning of flow battery enterprises is stimulated by financing enthusiasm and has exceeded actual demand.

    At present, many flow battery products are still in the research and development stage, lacking unified technical standards and transparent performance data, which makes it difficult to evaluate their effectiveness in actual projects.

   In addition, liquid flow energy storage systems often encounter performance issues during operation, especially in terms of stability and service life.

   Moreover, the cost of flow battery systems remains at 2 to 3 yuan per watt hour, while the winning price of lithium battery energy storage systems has dropped to below 0.7 yuan per watt hour.

   This cost gap makes it difficult for flow batteries to compete economically with lithium batteries, limiting their market applications.

   Overall, market demand is still limited. Using a set of data, according to the statistics and predictions of QYR, the global flow battery market sales in 2023 will only be 310 million US dollars, almost only 2% of lithium batteries.