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The International Energy Agency (IEA) predicts that in 2025, electricity generation from renewables will surpass that from coal for the first time, with coal's share falling below 33%, a first in nearly 100 years. By 2027, solar PV is expected to become the world's second-largest low-emission source of electricity, trailing hydropower. Building new power systems dominated by renewable energy sources will advance the sustainable development of digital, intelligent, and green energy.
As fossil fuels recede, green electricity blossoms across the land. In 2025, driven by the combined effects of policy, technological innovation, market expansion, and application penetration, the global renewable energy industry is transitioning from scale growth to quality improvement. Breakthroughs in solar PV and wind power efficiency, diversified applications for energy storage and hydrogen, and the revival of nuclear power collectively propel the energy mix toward a cleaner, safer, and more energy-efficient future.
2025 proved to be a critical turning point for the global energy transition. The IEA's Renewables 2025 report indicates that from 2025 to 2030, global renewable power capacity is expected to grow by 4,600 GW, reaching 2.6 times the total capacity of 2022. Solar PV will account for nearly 80% of this growth and become the main driver. However, due to policy adjustments in some countries, the growth forecast for renewables from 2025 to 2030 has been revised down by 5% compared to 2024. Overall, while the global PV industry faces challenges such as slowing growth, overcapacity, and policy fragmentation in 2025, its fundamental, long-term upward trajectory remains unchanged.
As the global PV industry enters a period of rational development, the regional market landscape has also undergone significant changes. A pattern of steady growth in Europe and a leadership role for emerging markets has become the new normal. For instance, regions like the Middle East, North Africa, and Southeast Asia are experiencing a surge in PV demand due to volatile fossil fuel prices and electricity shortages. Advancing the sustainable development of the PV market requires leveraging innovative technologies and system synergies. This can help achieve substantial cost reductions and efficiency gains while meeting the needs of diverse application scenarios.
In 2025, the global wind energy market navigated a complex landscape of challenges and opportunities.
The Global Wind Report 2025, published by the Global Wind Energy Council (GWEC), shows that in 2024, global new wind energy installations reached 117 GW, with cumulative capacity surpassing 1,136 GW. Off shore wind capacity is projected to exceed 230 GW globally by 2030. In the short term, the wind energy market will continue to face challenges, including policy changes, cost constraints, and grid connection bottlenecks. In the long run, however, the energy transition driven by carbon neutrality, the cost-reduction potential from technological breakthroughs, and the expansion potential of emerging markets will continue to support the industry's growth. Structurally, the steady scaling of onshore wind power and the accelerated growth of off shore wind power are becoming mainstream. GWEC's Global Off shore Wind Report (GOWR25) shows that by the end of 2024, global grid-connected off shore wind capacity reached 83 GW, enough to power 73 million homes. Experts suggest that 2025 served as a "springboard" for the wind energy industry's transformation. Companies that can overcome supply chain bottlenecks, adapt flexibly to policy changes, and master core technologies will dominate future global competition.
From an overall trend perspective, the global renewable energy storage market in 2025 can be summarized as "leapfrog growth in total volume, transition from a single technology to diverse technologies, and phased release of regional demand." According to BloombergNEF's forecast, the newly installed capacity of global renewable energy storage is expected to grow at a CAGR of 21% between 2025 and 2030, reaching 137 GW/442 GWh by 2030. From the demand side, energy storage demand in commercial & industrial markets is surging as businesses combine energy storage with PV for self-consumption and to feed surplus power back to the grid, thereby reducing energy costs. Emerging scenarios, such as data centers and battery swapping stations, are rapidly growing: the need for uninterrupted power supply in data centers drives the rapid development of energy storage applications, and distributed storage provides peak shaving and valley filling services for battery swapping stations. In the residential storage sector, Europe is leading the global market, with residential storage becoming the main choice due to high residential electricity prices and stable subsidies. Residential storage in China is growing rapidly, particularly in rural areas, where the PV + residential storage model is becoming increasingly popular. It is foreseeable that, driven by both policy and market forces, grid-forming energy storage systems (ESSs), PV+ESS integration, and long-duration hydrogen ESSs will become key drivers of future energy storage development.
As the proportion of renewable energy sources continues to increase in the overall energy mix, it is crucial to ensure that these sources are integrated into the grid more stably and safely to maximize their value. Breakthroughs in core technologies, including upgrades to grid-forming inverters and grid-forming ESSs, are key to addressing stability issues in renewable energy grid integration and improving energy consumption efficiency.
The development of grid-forming inverters and gridforming ESSs addresses a fundamental conflict: the traditional grid's reliance on synchronous generators for voltage and frequency support is incompatible with the intermittent nature of high-penetration renewable energy sources like wind and solar. By enabling renewable energy generation and storage equipment to actively form and stabilize the grid, grid-forming technology ensures safe and reliable integration of renewables. More than just technical upgrades, grid-forming inverters and gridforming ESSs represent a paradigm shift. They function as the "heart and nerves" of new power systems. This evolution from merely connecting to the grid to actively forming the grid is a giant technological leap and an inevitable direction for the global energy transition.
In the context of high renewable energy penetration, traditional power systems that rely on large-scale synchronous generators for inertia and voltage support are gradually being phased out. Grid-forming inverters and ESSs are being developed because they can precisely adapt to the core characteristics of new power systems: a high proportion of renewable energy and extensive use of power electronics. They effectively address problems such as insufficient grid inertia and weak anti-disturbance capability caused by renewable energy integration, thereby ensuring the balance of power supply and demand. By actively establishing voltage/frequency references, gridforming inverters and ESSs essentially inject virtual inertia into the grid, thus becoming the underlying support for the stable operation of new power systems.
Due to the integration of high proportions of renewable energy, the explosive growth of distributed energy, and the impact of multiple load types, traditional power systems are struggling with stability control and flexible regulation. To address these challenges, Huawei Digital Power launched the world's first Smart String Grid Forming PV+ESS Solution in 2025, ushering in an era of full-scenario grid-forming. Centered on "True GridForming, Full Intelligence, and High Quality," the solution achieved three key breakthroughs: upgrading from ESS-only grid forming to PV+ESS grid forming, from generation-side grid forming to all-scenario grid forming covering generation, transmission, distribution, and consumption, and from site visibility and manageability to full-link device-edge-cloud intelligence and full-lifecycle intelligent management. With comprehensive innovation across components, algorithms, equipment, and systems, the solution features six key capabilities: inertia response, primary frequency regulation, short circuit capacity, power oscillation damping, black start, and on/off-grid switching It delivers leading performance in multi-machine parallel connection, oscillation damping, and reliability.
In regions with a large proportion of renewable energy generation, such as Xizang, Xinjiang, Inner Mongolia, and Qinghai, the application scale of grid-forming energy storage plants is gradually expanding. Huawei's Smart String Grid Forming PV+ESS Solution will propel the industry from ESS-only grid forming to all-scenario grid forming, and from equipment-level management to full-link device-edge-cloud intelligence, and provide a replicable energy transition solution.
As the high proportion of renewable energy integration intensifies power system volatility, deep synergy among generation, grid, load, and storage is the only way to ensure safe and stable grid operation. This synergy achieves optimized coordination across the entire electricity chain (generation, transmission, consumption, and storage) by linking technologies and mechanisms. This collaborative model improves the utilization efficiency of renewable energy, optimizes energy resource allocation, and accelerates the evolution of power systems from the traditional "generation-follows-load" model toward lowcarbon, flexible, and intelligent new power systems.
Grid-forming inverters are key equipment supporting the stable operation of new power systems. Unlike traditional grid-following inverters that rely on the grid voltage reference, grid-forming inverters actively establish voltage and frequency references. They provide virtual synchronous generator (VSG) characteristics even in weak-grid or islanded operating conditions, enhancing the system's inertia support and voltage stability. In power systems with a high proportion of renewable energy, grid-forming inverters can effectively enhance the grid's dynamic response and improve power quality. These inverters can provide the required grid-support capability for future power systems based on renewables.
Grid-forming ESSs connect generation, grid, load, and storage, enabling wind energy+PV+ESS systems to operate independently, supply power in islanded mode, and even perform system-level functions such as black start. In weak-grid areas, such as remote PV power plants, grid-forming ESSs can independently establish microgrids, ensure reliable power supply to the load, and serve as the link that enables tight synergy among generation, grid, load, and storage.
In 2025, Huawei Digital Power collaborated with SchneiTec to build Cambodia's first energy storage plant. The 12 MWh project includes 2 MWh dedicated to validating the stabilizing effect of the Huawei Smart String Grid Forming ESS in off-grid and weak-grid scenarios. The project achieves a stable output from intermittent renewable energy sources and has received a TÜV SÜD certification.
In conclusion, integrating grid-forming inverters and gridforming ESSs enables distributed renewable energy to shift from grid-following to grid-forming mode.
The increased penetration of renewable energy sources, such as wind and solar, is leading to greater frequency fluctuations, voltage instability, and islanding in power systems. Grid-forming technology ensures grid stability through active support and intelligent control. This technology provides renewable energy sources with inertia support and reactive power regulation, enhancing stability by suppressing disturbances and fluctuations. This supports grid connection requirements in weakgrid conditions and emerging markets. In terms of flexibility, grid-forming technology removes dependence on strong grids, maintains stability in weak-grid and off-grid conditions, and adapts to supply-demand changes through stepless inertia adjustment. The world's largest 100% renewable-energy microgrid project, built by Huawei Digital Power in The Red Sea destination in Saudi Arabia, has been operating for over 2 years and continues to supply green electricity.
With its dual capabilities of active support and scenario adaptation, grid-forming technology addresses the reduced inertia and stability margin associated with integrating high levels of renewable energy into the grid.
The transition of any new technology from R&D to largescale deployment relies on a systematic framework of standards and normative guidance. Standards are the compass for technological breakthroughs and the ballast for industrial implementation.
Internationally, the development of standards for gridforming technology focuses on scenario-based functional definitions, with significant differences between countries: some focus on model verification, some emphasize functional detail, and others innovate with visual guidance. Despite these differing priorities and the lack of a unified international standard for grid-forming technology, the standardization process is undeniably accelerating. The UK, Australia, and China have already incorporated grid-forming technology into the technical requirements for energy storage and inverter projects. Grid-forming capability in inverters and energy storage equipment will likely become a non-negotiable prerequisite for future market entry.
China's systemic standardization effort follows a clear path from policies and pilot verification to association standards and national standards. For example, in 2023, the China Electrotechnical Society officially approved the release of the association standards: Technical Specification for Application of Grid-Forming Energy Storage System (T/CES 243-2023) and Test Specification for Application of Grid-Forming Energy Storage System (T/CES 244-2023), drafted by the China Electric Power Research Institute of State Grid Xinjiang and other companies. This was the first release of association standards in China for gridforming energy storage technology, filling a gap in the domestic standards system for testing the connection and operation of grid-forming ESSs. With the successful deployment of leading grid-forming energy storage solutions in multiple countries, China's standards are rapidly going global.
Grid-forming energy storage is currently entering a phase of rapid development. Application scenarios are expanding from power generation to distribution and consumption, with a corresponding increase in industry scale. However, alongside rapid growth, safety hazards are becoming increasingly prominent, and risk governance systems are not keeping pace with the development.
In July 2021, a fire occurred at an energy storage project in Victoria, Australia, completely igniting 13 tons of lithium-ion batteries in a single container. In February 2025, a fire broke out at a 50 MW/100 MWh energy storage plant in Scotland, UK, possibly linked to battery unit failure. In June 2025, a fire erupted at a 62 MWh lithium-ion battery energy storage plant in Pohang, Gyeongsangbuk-do, South Korea, the fifth such fire in South Korea since the start of 2025. These disastrous events expose the risks of thermal runaway and reignition, impacting public acceptance of and investment confidence in new energy.
Addressing these issues requires a focus on three areas:
Across the industry, there is a heavy emphasis on construction and use rather than on operation, maintenance, and decommissioning. To address this imbalance, standards development should encompass the entire ESS lifecycle, from initial design through final disposal. At the same time, specialized safety standards must be formulated, focusing on critical links. For instance, issuing specialized standards for core links with high fire accident rates to strengthen risk control. Specialized standards for emergency response should also be established.
European and North American countries have built a comprehensive, stringent system for energy storage safety that spans cell selection, battery management systems (BMSs), and electrical design. In the North American market, many regions have made UL 9540A certification a prerequisite for the grid connection of ESSs. Europe primarily relies on the International Electrical Commission (IEC) framework. Standards such as IEC 61508 impose strict monitoring requirements on BMSs. In recent years, some countries in the Asia-pacific region have also gradually introduced relevant mandatory certifications. For instance, Malaysia requires batteries and ESSs to be certified by the Standards and Industrial Research Institute of Malaysia (SIRIM). Singapore requires ESSs to be certified by the Energy Market Authority (EMA) and energy storage plants to comply with NFPA 855 (Standard for the Installation of Stationary Energy Storage Systems). The Electrical Energy Storage Equipment - Safety Requirements Specification (SA TS 5398:2025), released by Standards Australia in July 2025, outlines the minimum safety requirements for original equipment manufacturers and importers. Japan requires residential ESSs to pass JET (Japan Electrical Safety & Environment Technology Laboratories) certification, and electrical equipment, such as power conversion systems (PCSs), to pass PSE (Product Safety Electrical Appliance & Material) certification.
In China, the standard GB 44240-2024 "Secondary lithium cells and batteries used in electrical energy storage systems—Safety requirements" has been officially implemented. This is China's first mandatory national safety standard for energy storage batteries. It upgrades the safety requirements for lithium batteries used in ESSs from an industry recommendation to a mandate, filling a critical regulatory gap in the renewable energy sector.
Second, from a technology and solutions perspective, systematic protection should be implemented, covering critical aspects such as cell selection, compartment isolation, intelligent warning, and fire-fighting linkage, to provide comprehensive safety assurance.
For instance, Huawei Digital Power's innovative tripleprotection design for battery packs, string-level dualstage architecture, and intelligent health diagnosis ensure the safety of ESSs throughout their lifecycle. Specifically, the battery pack is considered the minimum safety unit, and a triple-insulation approach is used to prevent arcing, thermal propagation, and fire, in line with the mechanism of battery thermal runaway. The optimized architecture effectively prevents current backflow, maintains stable active power during high- and low-voltage ride-throughs, and supports rapid grid recovery. The leading digital management platform visualizes safety, facilitating management. The intelligent safety protection from the cell to the grid supports fault warning for up to 7 days, fault identification for over 30 types, and 24-hour realtime status detection.
Furthermore, Huawei Digital Power, in collaboration with the international authority DNV, conducted an extreme ignition test on its Smart String Grid Forming ESS to verify its safety protection capabilities under extreme burning conditions. Looking ahead, Huawei Digital Power will continue to provide customers with high-quality, highsafety PV+ESS solutions covering the entire lifecycle.
Third, from the perspective of establishing insurance and liability mechanisms, Europe has introduced specialized energy storage insurance to drive manufacturers to internalize safety as a competitive advantage. For instance, Altelium partnered with MS Amlin Underwriting to introduce the world's first data-driven battery energy storage insurance and warranty program. In China, the National Energy Administration (NEA) and other departments jointly issued the Notice on Strengthening the Safety Management of Electrochemical Energy Storage to effectively implement safety management responsibilities for electrochemical energy storage. Insurance companies in China have also built a diversified portfolio of energy storage insurance products.
In September 2025, in a series of press conferences themed "High-Quality Completion of the 14th FiveYear Plan", the Ministry of Industry and Information Technology (MIIT) stated that it had collaborated with relevant departments to curb irrational competition in key industries such as electric vehicles and PV in accordance with laws and regulations, and had achieved initial results. The shift from accelerated expansion to high-quality development, and from large-scale deployments to a focus on application and quality, poses new challenges for the renewable energy industry. It is also the inevitable result of the combined action of global standards improvement, resource constraints, technological changes, and societal demand.
From the perspective of safety and reliability, increasingly strict global standards are building the quality baseline. The North American UL 9540A standard covers detailed thermal runaway test methods and full-scenario testing, including high-temperature sodium batteries. The European IEC/EN standard has refined core indicators such as voltage support and fault ride-through. These high standards and strict requirements stem partly from painful lessons of safety incidents, and partly from emerging markets simultaneously raising the entry threshold, pushing companies to accelerate the transition from "connecting to the grid" to "connecting to the grid safely."
Full lifecycle management is strongly advancing the efficiency revolution. The EU's new Batteries Regulation mandates producers to bear full chain responsibility, sets specific recycling rate targets, and further extends environmental responsibilities. Japan and South Korea use cascading technology to give retired batteries a second life in the energy storage sector, enabling effective resource recycling. Countries are continuously improving product quality and safety and advancing sustainable development through policies, mechanisms, and technological innovation.
Digitalization and intelligent O&M will redefine the operational logic and pave the way for high-quality development. For instance, the application of "AI + energy storage" reshapes core aspects such as battery management, energy dispatch, and electricity trading, and drives the intelligent upgrade of the entire energy storage industry. Furthermore, many new energy storage projects have introduced AI-driven predictive O&M to significantly reduce downtime risks and enhance asset lifespan and revenue stability. Technological upgrades have become the core drivers for quality improvement.
From an environmental and social responsibility perspective, leveraging renewable energy and new energy storage technologies significantly reduces emissions and substantially alleviates issues such as smog and acid rain. The widespread adoption of electric vehicles is changing driving habits, reducing reliance on fossil fuels, and lowering traffic congestion and air pollution. In Africa, AI-assisted hybrid power stations provide a stable power supply to hundreds of thousands of households. In Latin America, the deployment of energy storage projects has increased the proportion of women in employment. In Europe and North America, environmental, social, and governance (ESG) ratings directly influence corporate competitiveness. Environmental sustainability, social responsibility, and commercial value are no longer separate goals but a unified whole, mutually empowering one another.
In conclusion, high-quality development is the inevitable choice for the renewable energy industry to shift from a scale-driven mode to a value-driven one.
Huawei Digital Power's successful practices demonstrate that high-quality development does not slow progress; rather, it is the only path to ensuring industry sustainability. Huawei Digital Power has developed a comprehensive testing system that covers all scenarios, spans the entire R&D process, and encompasses all elements. The system improves quality standards, optimizes product and on-site deployment architectures, and enforces strict quality controls. Through modeling and simulation, the mark of "high quality" is imprinted on its products from the very beginning. Huawei Digital Power has developed ultra-high-precision models for Smart PV and energy storage equipment, achieving an error rate of 2% or less, far below the industry standard of 10%.
For the testing phase, Huawei Digital Power has deployed five external test sites in Hainan, Gansu, Heilongjiang, and other locations to test in extreme environments, including extreme cold, heat, dryness, humidity, and high corrosivity. After launch, each product generation undergoes rigorous extreme-environment testing at these external test sites. For instance, to test performance in extreme cold, Huawei's testing department built a real –50°C environment for physical testing that maintained the extreme temperature for 3,000 to 4,000 hours.
Huawei Digital Power will continue to create high-quality, competitive products and services, enhance customer satisfaction and product quality, and accelerate the development of its digital power business.
When we examine the development trajectory of the global renewable energy market, it is clear that the early policy-driven model quickly spurred the industry. However, as the renewable energy industry continues to expand, a single policy driver is insufficient. The investment logic is bound to shift to a market-driven model, with the core focus on enabling renewable energy assets and achieving autonomous profitability through a diversified revenue portfolio. The combination of spot arbitrage, capacity market, green certificate/carbon market, and long-term power purchase agreement (PPA) is the optimal solution for this transition.
These four components are not isolated; they form a complementary, closed loop offering short-term to long-term revenues and basic to value-added returns. Spot arbitrage refers to capturing short-term revenue opportunities by flexibly adjusting generation/storage output to track real-time price differences between the peak and valley in the electricity spot market. It involves purchasing at low prices and selling at high prices to effectively increase an asset's short-term utilization rate. The capacity market primarily secures long-term revenue safety. The grid pays a capacity fee to renewable energy projects to ensure supply reliability, off setting the long-term revenue shortfall caused by the intermittency of renewable energy. The emergence of the green certificate/carbon market is to better activate environmental value. For example, EU Guarantees of Origin (GOs) and China's Green Electricity Certificates (GECs) are strong proofs of the clean attributes of electricity. They can be sold to enterprises with carbonneutrality requirements. The carbon market allows monetizing a project's emission reductions. The Opinions on Promoting Green and Low-Carbon Transition and Strengthening the Construction of the National Carbon Market propose that by 2027, China’s carbon emission trading market will essentially cover the main emissionintensive industries in the industrial sector. The national voluntary greenhouse gas emissions reduction trading market will cover all key sectors. Long-term PPA is the "anchor point" for revenue. Enterprises or the grid sign long-term agreements (5–20 years) with renewable energy projects, locking in basic electricity prices and generation volumes to mitigate the risk of long-term electricity price volatility, provide stable cash flow for the project, and eliminate the revenue uncertainty from early dependence on intermittent natural resources. In June 2023, Air Liquide Group in France signed a 9-year PPA with China Three Gorges Renewables and the China Three Gorges Jiangsu Branch, under which it trades 200,000 kWh of green electricity per year.
The core value of the preceding combination is to break the dependence of renewable energy on a single revenue source, and this has become the mainstream investment logic for renewable energy in various countries. This also means that renewable energy investment has entered the mature stage of market pricing and diversified profitability. Market mechanisms reshape revenue models, and cross-scenario integration unlocks ecological value. This requires enterprises to combine technological empowerment with ecological synergy to drive sustainable development in the renewable energy industry.
