Growing Challenges in the Maritime Battery Industry, states an Energy Portal news source.
Maritime battery industry has experienced significant growth
Over the past year, the maritime battery industry has experienced significant growth, with over 1GWh of batteries now being used in ships worldwide. This represents a 72% increase in industry growth from the previous year. However, this growth has not come without its challenges.
One of the main challenges faced by shipbuilders and maritime battery suppliers is market saturation in electric ferry orders. Electric ferries have historically been a driving force behind the electric ship market, accounting for 37% of maritime battery capacity deliveries between 2019 and 2022. Norway, in particular, has been a leader in electric ferry adoption, with around 100 electric ferries in operation. However, market saturation is expected to occur soon as government targets are set to be surpassed next year.
Another challenge is the negative impact of the pandemic and geopolitical events, such as the Russia-Ukraine war, on new-build contracts for electric and hybrid vessels. The uncertain climate and inflation have affected contracts for ship-types targeted for electrification.
Despite these challenges, there are new opportunities emerging in the maritime battery industry. Hybrid cargo vessels are expected to become a major market for battery installations. Zero-emission anchorage requirements, upcoming regulations, and the potential for larger battery systems per vessel are driving the demand for battery installations.
China is also becoming a major competitor
China is also becoming a major competitor in the maritime battery industry. Chinese battery suppliers are offering low-priced, type-approved marine battery systems, taking advantage of their high levels of vertical integration and battery chemistries like LFP. This competition from China is expected to help consolidate and streamline the value chain and drive future growth for the industry.
While marine battery suppliers outside of China may currently command a premium due to their experience in the safety-critical sector, China’s entry into the market is expected to bring further growth and consolidation.
Overall, the maritime battery industry still has significant room for growth, as only a small percentage of the global merchant fleet currently runs on alternative fuels. Battery systems not only improve the efficiency of engines but also support the development of future technologies like hydrogen fuel cells. With the industry sailing into multi giga-watt hour territory, the future looks promising.
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Source: Energy Portal