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 Shenzhen-based BYD plans to add 6 gigawatt hours of global
production for batteries in each of the next three years, and hopes
to keep adding at that pace afterwards if demand is solid, Matthew
Jurjevich, a spokesman for the company, said on Friday.
That means BYD could ramp up from 10 GWh capacity at the end of this
year to about 34 GWh of batteries by the beginning of 2020. This
would put it about even with Tesla's planned $5 billion Nevada
gigafactory.
The companies are fast emerging as two of the key players in the
nascent electricity storage sector. Storage technology is considered
critical to integrating large amounts of renewable energy because it
can absorb excess power from wind farms or solar panels and keep
that for use when conditions don't allow for power generation.
"We have demonstrated that BYD is capable of adding 6 GWh every year
with strong market demand," Jurjevich, who works for BYD's U.S.
unit, said in an interview.
The sector has attracted Tesla, BYD and a range of startups as well
as stalwart battery manufacturers and is expected to grow to $1.5
billion by 2019 from $128 million in 2014 in the United States
alone, according to GTM Research.
BYD, which declined to provide investment budgets, ended last year
with 4 GWh of capacity and will be at 10 GWh later this year. The
U.S. energy storage market is expected to triple this year to 220
MW, according to GTM.
Most of BYD's production is in China, but the company is opening a
major new factory in Brazil this year that will contribute
meaningfully to output next year, Jurjevich said.
BYD, which started out making mobile phone batteries, will also
scale up manufacturing in the United States as demand for its
batteries increases, he added.
According to data published last year by Lux Research, BYD is the
sixth-biggest manufacturer of batteries for hybrid and plug-in
vehicles. Panasonic Corporation <6752.T>, which makes cells and
batteries for Tesla, is the biggest.
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Tesla, founded by entrepreneur Elon Musk, has said it will launch
its own production of battery cells in Nevada in 2016 and reach 35
GWh of capacity by 2020. Tesla does not currently produce battery
cells, according to a company spokeswoman.
BYD opened two manufacturing plants in Southern California in 2013
to produce both electric buses for public transportation and
batteries.
The company shocked many in 2003 when it launched its automotive
business and has since become one of China's most successful
automakers. Outside of China, however, it has focused on selling
buses rather than cars.
BYD plans to deploy 70 megawatt hours of projects in that market in
the United States this year, and has another 130 MWh of projects in
its U.S. pipeline.
It has already deployed 40 MWh of projects in North America with
customers including Chevron Corp <CVX.N> and Duke Energy Corp
<DUK.N>.
(Reporting By Nichola Groom; Editing by Terry Wade and Alan Crosby)
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