Smart tech uptrend fuels solar storage

Amid surging global demand for artificial intelligence computing power and the resulting strain on electricity grids, Chinese green energy enterprises are stepping up efforts to provide integrated China solutions for digital economy decarbonization.

JinkoSolar, one of the world's largest solar module manufacturers, has explicitly identified energy storage — specifically tailored for AI data centers (AIDCs) — as its "second growth curve", according to Qian Jing, global vice-president of the company.

The strategic pivot comes as the world grapples with the massive energy footprint of the AI boom.

According to the International Energy Agency, global electricity generation to supply data centers is projected to grow from 460 terawatt-hours in 2024 to over 1,000 TWh in 2030 and 1,300 TWh in 2035.

China is by far the largest data center market today together with the United States. While data center electricity supply is dominated by coal, renewables, mostly solar PV and wind, are expected to add nearly 90 TWh between 2024 and 2030, supported by an increase in the share of renewables in the electricity grid mix, provincial co-location mandates and policies to prioritize the construction of data centers in renewables-rich western parts of China, it said.

Renewables, according to IEA, remain the fastest-growing source of electricity for data centers, with total generation forecast to increase at an annual average rate of 22 percent between 2024 and 2030, meeting nearly 50 percent of the growth in data center electricity demand.

Against this backdrop, Qian said that the explosive, rigid demand for AI computing is fundamentally reshaping the value of energy storage.

"Energy storage is transitioning from a 'cost center' to a 'profit center' by creating diversified revenue streams for data centers, which makes this sector highly price-insensitive," she said.

According to Qian, unlike traditional grid-side or commercial storage, AIDC storage achieves a business model leap from simple electricity price arbitrage to "computing value plus diversified revenue."

Through peak-valley arbitrage and demand-shaving, it drastically reduces the exorbitant electricity costs of computing hubs. Furthermore, storing green power helps data centers meet strict low-carbon mandates, while excess capacity can generate additional income through power grid ancillary services, such as frequency regulation."

This "computing plus storage" high-value model commands a significant premium in overseas markets, including the US, Europe and the Middle East, where there is an acute need for reliable, direct-connected green power for computing infrastructure, supported by flexible local electricity pricing mechanisms, she said.

To meet the rising demand, JinkoSolar has already signed a series of benchmark solar-plus-storage projects across the Middle East, Europe, the US and China, eyeing to support the low-carbon transition of global AI data centers while diversifying revenue streams.

Solar module production fell last year for the first time in 20 years, reflecting slowing demand, high inventories and low prices that left much of the industry unprofitable, said Tan Youru, a solar analyst at BloombergNEF.

Also at play were rising trade barriers that pushed more module assembly outside of China, he added.

Tan forecast another decline in 2026, as leading integrated manufacturers in China have been unprofitable for more than two years and are seeking to cut production further to avoid expanding losses.

Moving forward, the company aims to export an integrated solution comprising "energy storage, green electricity and AI dispatching". This approach is becoming deeply embedded into the energy architecture of overseas AI data centers, forging a new industrial ecosystem and strong competitive barriers, said Qian.

"JinkoSolar expects its energy storage business, particularly in the AIDC sector, to maintain a blistering annual growth rate of 100 percent to 150 percent over the next three years," she said. "To meet the stringent technical thresholds of global computing hubs, the company will focus heavily on delivering systems with ultra-high energy density, millisecond-level response times and exceptional safety and smart-operation capabilities."

zhengxin@chinadaily.com.cn