According to Official Account @chunengpai, on April 1st, Deye Shares announced an investment of RMB 2.127 billion to construct an annual 16GWh industrial and commercial energy storage production line in Cixi, Zhejiang.
According to the announcement, the project will be implemented in two phases: the first phase with a capacity of 7GWh and the second phase with 9GWh. It is planned to be completed and put into operation within 36 months after land acquisition, and to reach production capacity verification within 60 months.
This move, seemingly a routine capacity expansion for the company, actually harbors deeper implications: amidst the fierce competition in the European and American energy storage markets, this Zhejiang-based enterprise is quietly betting its chips on the high-growth demand in overseas markets such as Europe, Africa, and Latin America.
Why Choose Africa and Latin America for "Going Global"?
On the surface, this might appear to be a conventional operation for a company seeking incremental growth in emerging markets. However, a closer examination reveals that Deye Shares' strategic layout is far more complex than simply "going global."
Firstly, the energy predicament in Africa and Latin America is precisely the breeding ground for the urgent need for energy storage. South Africa's aging power grid is akin to a "time bomb," with annual power outage losses reaching 3% of its GDP. A 500kWh energy storage system can support a medium-sized factory's operation for 8 hours, which is a genuine "production necessity" for local businesses. In Southeast Asia, the Middle East, and other regions, frequent extreme weather and fragile power grid systems are creating an urgent demand for a stable power supply.
Secondly, high electricity prices are reshaping the commercial logic. Germany's time-of-use electricity price difference between peak and valley has exceeded €0.4/kWh, meaning a 1MWh energy storage system can earn over €180,000 annually through "buying low and selling high." In markets with significant electricity price fluctuations such as Brazil and South Africa, the payback period for industrial and commercial energy storage projects has been compressed to within 3 years, even shorter than the lifespan of some traditional energy projects. This economic advantage is transforming energy storage from an "optional configuration" to a "must-have solution."
Thirdly, policy subsidies and market gaps form a dual dividend. Governments in Africa and Latin America are aggressively incentivizing energy storage installations with subsidies: South Africa plans to invest over 100 billion Rand in subsidies for renewable energy projects within five years, while Indonesia, the Philippines, and other countries are exempting import tariffs on industrial and commercial energy storage equipment. European and American companies, limited by their localized service capabilities, often struggle to penetrate these regions deeply. Deye Shares, with its "China R&D + Southeast Asia Manufacturing" combination, can bypass the 25% inverter tariffs in the United States and quickly respond to customer needs through its Malaysian base, gaining a significant first-mover advantage.
Undercurrents in the Industry Transformation
Deye Shares' aggressive capacity expansion is actually a microcosm of the transformation and upgrading of China's energy storage industry. Over the past decade, Chinese companies relied on low-price dumping to seize the European and American residential energy storage markets. Now, facing fierce competition in the high-inventory red sea, turning to Africa and Latin America to open up new battlefields has become inevitable. However, this path is bound to be full of challenges: frequent local policy risks, weak payment capabilities, and the extreme difficulty of building localized service networks.
Nevertheless, Deye Shares has clearly prepared for a "protracted war." Its establishment of a localized service center in South Africa, customized halal certification for Islamic countries, and equity cooperation with African local enterprises all demonstrate a strategic depth beyond simply selling equipment. Perhaps in the near future, we will see this Zhejiang-based enterprise rewrite the global energy storage map – not by being the largest in scale, but by being the most attuned to the "capillaries" of Africa and Latin America.
Source：https://mp.weixin.qq.com/s/utmLfJzV5k5lg5ounfyPtQ