Sungrow, Fluence and Tesla leading BESS integrators says Wood Mackenzie

According to a new analysis from Wood Mackenzie, Sungrow dominated the global battery energy storage systems (BESS) market in 2022 as the leading vendor, followed closely behind by Fluence and Tesla.

According to Wood Mackenzie, the BESS integrator market had grown increasingly competitive in 2022, with the top five global system integrators accounting for 62% of overall BESS shipments (MWh).

Sungrow dominated the market with 16% of global market share rankings by shipment (MWh), jointly followed by Fluence (14%) and Tesla (14%), Huawei (9%) and BYD (9%).

Kevin Shang, senior research analyst at Wood Mackenzie, said: “As major policy developments propel the battery energy storage systems market, the BESS integrator industry is becoming increasingly competitive. While existing system integrators are striving to increase market share, the fast-growing energy storage market has also attracted many new entrants to this space.

“A common feature behind the leading BESS integrators is that their global presence allows them to access a larger customer base and unlock additional revenue streams. In addition, many BESS integrators have been seeking to enhance the vertical integration of their supply chain.”

Commenting on the supply chain, Shang added: “While global battery supply eased in 2023, after experiencing supply tightness the previous year, the limited supply of transformers has become the new bottleneck of the energy storage supply chain.

“The industry is struggling with short supply and price spikes of transformers, with a minimum lead time of more than one year for transformers of all sizes. This has a direct impact on system integrators as transformers are integral for grid connection.”

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North America leading the way

The North American BESS integrator market was found by Wood Mackenzie’s research to be highly concentrated, with the top five players holding 81% of the region’s market share in 2022. Tesla led the region with 25% market share rankings by shipment.

According to Shang, “as the world’s most vertically integrated energy storage provider, Tesla has a key advantage. Importantly, by integrating hardware, software and added services, Tesla can deliver continued improvements and new features to clients quickly.”

Following Fluence (at 22%), Chinese company Sungrow held its third position with a 13% market share in the North American market in 2022. This high ranking is largely attributed to the company’s cost competitiveness and advanced liquid-cooling products.

Asia Pacific

China led the Asia Pacific BESS integrator market, with an 86% market share in 2022.

According to Shan, China’s integrator market is becoming increasingly competitive, “squeezed heavily by both upstream and downstream supply chain participants.

“Possessing manufacturing capacity on key components, like cell, PCS (power conversion system), BMS (battery management system and EMS (energy management system), tends to be a necessity rather than a plus as bid requirements for energy storage projects become more detailed and stringent.”

Facing the trend of energy storage product homogenisation, price has become the most significant distinction and key winning bid factor in the region.

Shang added: “The price war among system integrators has started in China. We’ve observed an increasing number of players willing to sacrifice profits in exchange for market share, dragging down the profitability of the whole industry.

“However, we forecast that aggressive bid strategies with little margin will not be sustained. Intensifying market competition will make it difficult for companies with low profitability and no clear competitiveness to survive over the coming years.”

Wood Mackenzie’s BESS Integrator market share rankings are based on the number of BESS shipments in MWh in 2022. Only shipments with revenue recognised in the reporting year are counted towards the market share.

Wood Mackenzie’s primary data collection comes from annual BESS integrator surveys, public filings, project databases and discussions with system integrators, EPC providers and project developers. Where necessary, market-based estimates are made.