The emergence of low-cost energy storage batteries in the industry is essentially the result of the combined effect of multiple factors such as cost, technology, market competition, and compliance risks. The specific analysis is as follows from several dimensions:
I. Cost Side: Degradation of Materials and Processes
Downgrading of Battery Cell Materials
Some low-cost products use recycled lithium iron phosphate materials, low-nickel ratio ternary materials, or even mix inferior lithium manganate to replace high-specification cathode materials; for the anode, defective artificial graphite or natural graphite is adopted, leading to a significant decline in energy density and cycle life.
Cutbacks in BMS and PACK Processes
Necessary balancing boards and temperature sensors are omitted, or low-precision protection boards are used, resulting in inadequate safety and consistency of the battery system; in the PACK process, structural components are reduced and heat dissipation designs are simplified to further compress costs.
Supply Chain Scale and Inventory
Small and medium-sized manufacturers reduce costs by purchasing inventory battery cells and used modules, or clear inventory at low prices during the window period of falling upstream material prices to ship quickly.
II. Technology Side: Adoption of Outdated or Obsolete Solutions
Outdated Technology Routes
Some low-cost products still use outdated solutions such as lead-acid converted to lithium-ion and small-capacity series-parallel connection instead of mainstream technologies like lithium iron phosphate large modules or CTP (Cell to Pack), with performance and lifespan far below industry standards.
Skipping Verification Links
Necessary reliability tests (such as high-low temperature cycling and vibration impact) are skipped, and even third-party certifications (such as UL and CE) are not obtained to save testing and certification costs.
III. Market Side: Competition and Channel Driven
Industry Overcapacity
The production capacity of energy storage batteries has grown explosively in recent years. To compete for orders, small and medium-sized manufacturers resort to dumping below cost, especially in fragmented markets such as household energy storage and small industrial and commercial energy storage.
White Label and Non-Branded Competition
Non-branded manufacturers rely on low prices to achieve high sales volume, lacking investment in R&D and services. They mainly sell through cross-border e-commerce, small and medium-sized distributors and other channels to avoid competition from branded manufacturers.
Subsidy and Policy Arbitrage
There are loopholes in energy storage subsidy policies in some regions. Some manufacturers obtain subsidies through "fake energy storage" projects (such as low cycle times and false capacity declarations), and their products only meet the minimum acceptance standards.
IV. Risk Side: Hidden Costs and Compliance Issues
High Safety Risks
Low-cost batteries are more prone to problems such as thermal runaway, bulging, and fire, which may lead to high after-sales and compensation costs in the future.
False Labeling of Lifespan and Performance
The nominal cycle life is 5,000 times, but the actual number may be less than 2,000; the nominal capacity is 10kWh, but the actual usable capacity is only 7-8kWh, resulting in higher long-term use costs.
Compliance and Environmental Risks
Some products have not passed environmental certifications such as RoHS and REACH, and may face customs detention and fines when exported; discarded inferior batteries will also bring environmental pollution problems.
