Research logic: Lithium battery energy storage is expected to penetrate the energy storage market as a "disruptive" innovation technology. Innovation can be divided into continuous innovation and disruptive innovation. Continuous innovation is the process of continuously improving the performance of existing products and achieving higher profit margins through the development of advanced technologies, but it still targets existing markets and has not opened up a new one. Disruptive innovation, on the other hand, adapts to the needs of customers in new markets through continuous improvement and cost reduction. When the product cost falls within the acceptable range for customers in the new market, the disruptive innovative technology will be widely applied in this field, greatly expanding the application field and space of the product. By studying the characteristics of the lithium battery industry, we believe that lithium battery energy storage will be a disruptive innovation technology for the energy storage industry. In the future, the application of lithium batteries in energy storage will overturn the development speed, space, and industry pattern of the existing lithium battery industry, and be widely applied in the distributed photovoltaic and communication base station energy storage field with a market size of tens of billions of dollars.

Understanding lithium battery energy storage from the perspective of disruptive innovation: With the characteristic of "disruptive", the application is expected to accelerate the rapid growth of the energy storage industry. However, lithium battery energy storage is constrained by cost factors and has not yet launched large-scale commercial applications. We believe that lithium battery energy storage, due to its high power density, small size, low investment in a single device, and the ability to achieve decentralized investment, precisely meets the needs of distributed photovoltaic energy storage and communication base station energy storage. Once the price drops to the critical point, lithium battery energy storage will demonstrate its power as a "disruptive" innovative technology, achieving large-scale application in these two major energy storage fields, achieving explosive growth, and expanding the application of lithium battery energy storage to various other energy storage fields.

The demand for energy storage in distributed photovoltaics and communication base stations is enormous, and the characteristics of lithium battery energy storage that will be the first to break through the field of lithium battery energy storage perfectly match the unique demand for energy storage in distributed photovoltaics and communication base stations. In the future, it is expected to achieve a breakthrough in these two major energy storage markets. In the field of distributed photovoltaics, with the continuous decline of photovoltaic battery prices and the continuous increase in installed capacity, the corresponding energy storage demand has also grown rapidly. In the first half of this year, Tesla launched lithium-ion battery energy storage products such as "energy packs" and "energy walls", becoming iconic products for distributed photovoltaic lithium-ion battery energy storage; The trend of miniaturization and integration of communication base stations has become the main driving force for the lithium-ion backup power supply of communication base stations.

The lithium battery energy storage market has a vast space, and Xinwangda (24.70, -1.150, -4.45%) is expected to enter a harvest period due to its early layout. With the gradual expansion of the application of lithium battery energy storage, domestic and foreign manufacturers are planning to expand in this field. Among them, domestic lithium battery leader Xinwangda has been laying out lithium battery energy storage for many years. Last year, it established a wholly-owned subsidiary of Qinghai Xinwangda New Energy (1731.70, -84.530, -4.65%) in Qinghai Province, and participated in the leading domestic energy storage enterprise Juwei Company. The lithium battery energy storage module developed by Xinwangda achieved initial mass production in June this year. In August, the company announced plans to invest 30 million yuan in the industrialization project of the energy storage system. The layout and future development strategy of its lithium battery energy storage are gradually becoming clear. With the rapid growth of the lithium battery energy storage market, the company's layout in the lithium battery energy storage field will usher in a harvest period.