With the rapid adjustment of the energy structure, the demand for energy storage is showing a trend of high-speed growth.
Vanadium Redox Flow Batteries (VRFBs) are suitable for large-scale energy storage scenarios, such as supporting energy storage for wind farms and photovoltaic power plants, as well as in fields including power grid peak shaving and backup power supplies.
As a technical route with relatively high safety in the field of electrochemical energy storage, VRFBs are becoming the preferred solution in the field of large-scale long-duration energy storage.
According to forecasts from Guidehouse Insights, the global annual installed capacity of VRFBs is expected to rise to 32.8 GWh by 2031.
This article sorts out the core links and competitive pattern of the VRFB industry chain.
Overview of the Vanadium Redox Flow Battery Industry
Thanks to advantages such as high safety, long service life, and scalability, VRFBs have become one of the preferred technologies for long-duration energy storage.
The stack and electrolyte of VRFBs are relatively independent, and the energy storage capacity can be easily increased by enhancing the stack power and expanding the electrolyte volume. This makes VRFBs highly suitable for constructing 100-megawatt-level energy storage power stations.
In the field of new-type energy storage, VRFBs serve as an important supplement to lithium-ion battery energy storage. The most significant difference between VRFBs and other batteries lies in the storage method of the electrolyte.
Currently, the technical maturity of all-vanadium redox flow batteries is gradually improving. The industry chain has high complexity and involves multiple sectors, with the core links being the material end and the equipment end.
In-depth Analysis of the Panoramic New-type Energy Storage Industry Chain
01 Upstream: Vanadium Raw Material Supply & Stack Material Processing
The upstream of the VRFB industry chain mainly includes vanadium mines, raw materials such as vanadium pentoxide (V₂O₅) and sulfuric acid, carbon materials, polymer materials, and various auxiliary materials.
Vanadium mines and their processing industry occupy a core position, serving as the main source of vanadium pentoxide, a raw material for electrolytes.
Among domestic enterprises with vanadium mine layouts, according to public information:
Longbai Group owns the Panzhihua vanadium-titanium magnetite resource, the largest of its kind in China, with an annual raw ore output of 15 million tons.
Mingxing Electric holds 100% equity in Sichuan Aoshenda Resource Investment and Development Co., Ltd., which has obtained a total of 7 mineral rights for iron, manganese, vanadium, silver, copper, lead, zinc, and other minerals in areas such as Ganzi and Pingwu in Sichuan, Shanyang in Shaanxi, Jiangda in Tibet, and Qiemo in Xinjiang.
Henghao Mining, acquired by Hailiang Co., Ltd., owns four nickel mines, one vanadium mine, two manganese mines, and two copper-molybdenum mines.
Diagram of the Electrochemical Energy Storage Industry Chain: (Omitted in text translation)
Core Components on the Material End: Stack + Electrolyte
Stack
The stack is one of the core components of an all-vanadium redox flow battery. Composed of multiple unit cells connected in series, it converts chemical energy into electrical energy through electrochemical reactions.
The performance of the stack directly affects the output power and efficiency of the battery.
The stack materials of VRFBs are highly similar to those of hydrogen fuel cell stacks, mainly including several key materials such as electrodes, bipolar plates, diaphragms, and seals.
At present, all-vanadium redox flow batteries have not been applied on a large scale. Therefore, several representative enterprises mainly produce electrode materials through independent R&D and production or external processing for their own use. Representative manufacturers include Jiangyou Runsheng Graphite Felt and Jiaxing Nake New Materials.
Perfluorinated proton exchange membranes are mainly used as diaphragm materials at present, and there may be a shift to non-fluorinated conductive membranes in the future. Due to the complex preparation process, this market has long been dominated by a few U.S. and Japanese manufacturers such as DuPont, Gore, and Asahi Glass. Domestic enterprises like Dongyue Group and Jiangsu Kerun are accelerating the process of domestic substitution. Enterprises including Dongyue Group have acquired the capability of independently producing perfluorosulfonic acid resin membranes. However, high-quality Nafion membranes for flow batteries still need to be imported and are expensive.
Another technical route is the adoption of non-fluorinated ion-conducting membranes, i.e., non-ion-exchange diaphragms. This technology is an independent development direction of China, and research teams represented by the Dalian Institute of Chemical Physics, Chinese Academy of Sciences have achieved important results. Manufacturers such as Shanghai Electric, Xingchen Xinneng, and Kaifeng Times have also made key layouts in this route.
Due to differences in material selection and processes among various manufacturers, there are variations in the cost and performance of stack materials.
In addition, there is still significant room for improvement in the technology and processes of existing stack materials. Relevant R&D work is still in progress to gradually realize domestic substitution.
Electrolyte
The electrolyte is one of the key materials of VRFBs and directly affects the energy storage capacity of the battery.
The electrolyte stores the energy in the battery and realizes the conversion of electrical energy through redox reactions in the stack. Its formula and purity have a significant impact on the performance of the battery.
According to calculations, for an energy storage system with an 8-hour duration, the value share of the electrolyte is 53%, the diaphragm accounts for 19%, the graphite felt for 5%, the pump for 4%, and the power conversion system for 12%.
The manufacturing of the electrolyte consists of two steps:
Production of core precursors, i.e., vanadium chemicals (vanadium pentoxide, ammonium metavanadate, etc.). At present, enterprises with relevant technologies and mass production capabilities are basically large-scale vanadium extraction and processing companies.
Conversion of the precursors into electrolytes.
The raw material for the core component of the electrolyte is vanadium pentoxide. Domestic vanadium resource production capacity is relatively concentrated. Companies such as Vanadium-Titanium Co., Ltd., Pangang Vanadium & Titanium, HBIS Group, CNNC Titanium Dioxide, and Anning Co., Ltd. are in leading positions in the comprehensive utilization of vanadium-titanium resources and the production of vanadium products. In addition, Western Mining has proven reserves of 587,800 tons of vanadium pentoxide.
Currently, Dalian Borong New Materials Co., Ltd., a global leading enterprise mastering vanadium electrolyte manufacturing, holds a global market share of over 80% and has built the world's largest and first large-scale industrial vanadium electrolyte production line. Shandong Haihua Chlor-Alkali Resin Co., Ltd., a wholly-owned subsidiary of Shandong Haihua, and Flow Energy Storage Technology Co., Ltd. have jointly invested in the establishment of Shandong Flow Hai Material Technology Co., Ltd., which is currently constructing an all-vanadium redox flow energy storage electrolyte project with an annual production capacity of 36,000 cubic meters. Fengshan Quannuo, a holding subsidiary of Fengshan Group, has conducted R&D layout and technical reserves in vanadium battery flow electrolytes and is currently in the small-scale trial stage.
Schematic Diagram of All-vanadium Redox Flow Battery: (Omitted in text translation)
Source: China Nonferrous Metallurgy, "Research Progress in All-vanadium Redox Flow Battery Technology"
02 Midstream: Stack Assembly, Control Systems, etc.
The assembly technology of all-vanadium redox flow stacks includes stack assembly, control systems, other equipment, and accessories. Each link in the midstream has high technical barriers and involves various consumables and electronic components.
Stack Assembly
The stack segment has high technical barriers, and industry leaders with technical accumulation and capital advantages maintain long-term competitiveness.
The main steps of stack assembly include unit cell preparation, stack stacking, sealing treatment, testing, and commissioning.
Domestic representative enterprises include Dalian Rongke, Beijing Proneng, and Shanghai Electric Guoxuan New Energy. In addition, a number of companies have carried out relevant layouts, including State Grid Yingda, Xizi Clean Energy, Yicheng Xinneng, and Vanadium-Titanium Co., Ltd.
Control Systems
The control system is responsible for monitoring and managing the operating status of the battery to ensure its safe and efficient operation.
It includes the Power Conversion System (PCS), Battery Management System (BMS), and Central Control System (CCS). The required hardware devices are basic components in the power electronics industry and can be custom-produced through cooperation with relevant enterprises.
The PCS realizes bidirectional power transmission between the battery and the power grid, including equipment such as bidirectional inverters, transformers, and grid-connected switch cabinets, ensuring the efficiency of electrical energy conversion during the battery's charging and discharging processes. Major manufacturers include GoodWe, Sungrow Power Supply, Sungrow Power Supply, and Kehua Data.
The BMS is the core of the control system, responsible for monitoring, managing, and protecting the battery. It collects data such as the battery's voltage, current, and temperature through sensors, processes and analyzes the data, and then outputs control signals to regulate the battery's charging and discharging processes. BYD Semiconductor, SILAN Microelectronics, and CATL have all made layouts in this segment.
Overall, there are relatively few enterprises that specifically provide VRFB control systems. Most systems are either independently developed and used by relevant enterprises or produced through external processing.
For enterprises mainly engaged in energy storage electronic control technology R&D that have not yet entered the VRFB field, it will be relatively easy for them to transform in the future and provide solution services for VRFB control systems. Major manufacturers in this regard include GoodWe. As market demand expands in the future, more electronic control enterprises may transform and enter the VRFB sector.
03 Downstream: End-user Application Market
The downstream end-users of the VRFB industry chain mainly include various energy storage users, covering the power generation side, power grid side, and electricity consumption side.
China's vanadium flow batteries have been applied in projects such as smart grids, communication base stations, and power supply in remote areas.
As early as 2022, the Dalian Flow Battery Energy Storage Demonstration Project, the first national-level large-scale chemical energy storage demonstration project approved by the National Energy Administration, was officially connected to the grid and put into operation. The commissioning and grid connection of this project will accelerate the large-scale application of flow batteries.
At present, projects such as the Zhenhai Grid-source Friendly Wind Farm Energy Storage Project and the SPIC Haiyang Energy Storage Demonstration Project have entered the grid connection stage. Meanwhile, engineering projects including the Xiangyang All-vanadium Redox Flow Battery Integrated Power Station are under construction. The 100MW/500MWh All-vanadium Redox Flow Battery Energy Storage Power Station Project in Xiangyang High-tech Zone is invested and constructed by Hubei Ludong Zhongfan New Energy Co., Ltd. Upon completion, it is expected to become the largest all-vanadium redox flow energy storage power station in China.
In addition, New Tian Green Energy has invested in the construction of the Phase I Project of Fengning Dongliang Energy Storage in Hebei. This project has an installed capacity of 100MW and adopts all-vanadium redox flow battery energy storage technology, with an energy storage capacity of 2MW/8MWh.
Since 2010, Dongfang Turbine Co., Ltd. of Dongfang Electric Group has fully carried out research on all-vanadium redox flow batteries and has a core intellectual property system. It has built multiple application demonstration projects, such as the Chengdu Chuankai 120kW/500kWh energy storage system and the Dongfang Turbine 1MW photovoltaic + 120kW/240kWh all-vanadium redox flow photovoltaics-energy storage-charging integrated energy demonstration zone. In addition, it has made layouts in both the upstream and downstream of the VRFB industry chain, including links such as electrolytes, stacks, and system integration.
04 VRFB Market Pattern
From the perspective of the overall competitive pattern, China leads the world in the research and industrialization of all-vanadium redox flow batteries, with relatively complete technologies. A number of domestic scientific research institutions and enterprises, such as the Dalian Institute of Chemical Physics, Chinese Academy of Sciences, and Dalian Rongke Energy Storage Technology Development Co., Ltd., have achieved important breakthroughs in key technologies of all-vanadium redox flow batteries, including electrode materials, electrolytes, and stack structures. Some technologies have reached the international leading level.
However, the industrialization process is still in the stage of accumulating momentum for development. Currently, the domestic production capacity of all-vanadium redox flow batteries is gradually expanding, but no obvious economies of scale have been formed yet.
Domestic VRFB equipment enterprises can be roughly divided into two categories:
One category is start-ups transformed from independent R&D technologies of scientific research institutes, mostly in the mode of university-enterprise cooperation, represented by Dalian Rongke.
The other category is enterprises that have obtained relevant technologies through absorption, merger, or holding, then optimized and upgraded them to participate in competition, represented by Beijing Proneng.
Enterprises engaged in the complete machine manufacturing of all-vanadium redox flow batteries include Wuhan NARI, Shanghai Electric, Dongfang Electric, Weilide Energy, and Shanghai Shenli Technology. Each of these enterprises possesses core technologies and has generally conducted R&D for more than 10 years.
At present, the internal factors hindering the large-scale commercialization of flow batteries include limited application scenarios caused by single performance and insufficient economic efficiency due to excessively high initial costs. The external factor is that downstream demand has not yet been fully unlocked.
There is still significant room for reducing the initial investment cost of VRFBs. The main cost reduction approaches include lowering variable costs (such as replacing with low-cost materials and shortening the manufacturing process) and amortizing fixed costs (such as increasing power density and extending energy storage duration).
The future development directions of all-vanadium redox flow batteries will mainly focus on improving battery performance to expand application scenarios and reducing the initial investment cost of the system. In the process of accelerating the industrialization of all-vanadium redox flow batteries, opportunities are expected to emerge in the battery end and material end of the industry chain.
