Canadian Solar manufacturing subsidiary CSI Solar’s battery storage shipments exceeded the 1GWh mark in the first half of 2022 while the parent company’s battery project pipeline stands at 31GWh.
The vertically integrated solar PV company announced its second quarter financial results last week, raising its full-year revenue guidance to US$7.5 billion to US$8 billion from US$7 billion to US$7.5 billion, as reported by our sister site PV Tech.
It has also raised its solar manufacturing targets, including plans to have 50GW of annual PV module manufacturing production capacity in place by the end of 2023.
CEO Dr Shawn Qu referred to increased global demand for solar PV driving the company’s expansion plans in a call to explain results. Qu also said that the company has experienced significant growth in battery storage solutions shipments, while the US’ Inflation Reduction Act legislation will result in “a big acceleration in demand for clean energy” in the country, “especially for solar energy and battery storage”.
Canadian Solar’s US developer subsidiary Recurrent Energy claims more than half of the solar company’s pipeline of project opportunities, with 16.5GWh of potential contracts for battery storage alongside 8GWp of solar development opportunities.
In reporting the company’s previous results for Q1 in late May, Energy-Storage.news noted that at that time Canadian Solar’s claimed global battery storage pipeline was 27GWh, meaning it has rapidly grown by 4GWh.
The company has long stated its aim to establish energy storage as a key part of its core business, from manufacturing to project development.
Overall, Canadian Solar achieved a 16% gross margin for the quarter, doubling its gross profit sequentially to US$371 million. Revenues grew 85% from Q1, to US$2.3 billion. Senior VP and CFO Dr Huifeng Chang said the company ended the quarter with a total cash position of US$1.9 billion.
That gave the company “significant financial flexibility to fund long-term growth opportunities, including accelerating our upstream capacity expansion,” Chang said.
Battery storage solutions contributed significantly to the strong net revenue position, as did higher project sales and higher solar shipment volumes at a higher average selling price (ASP).
Project development falls under Canadian Solar’s Global Energy business line (which includes Recurrent Energy). Global Energy projects include utility-scale solar PV as well as hybrid solar-plus-storage and standalone battery assets.
CSI Solar expects up to US$1.9 billion battery storage solutions shipments for 2022
The company reaffirmed guidance for total battery storage shipments from CSI Global of 1.8GWh to 1.9GWh for the full year and 2.1GW to 2.6GW of total projects sales for Global Energy, including solar PV as well as battery storage.
Since the beginning of 2021, Global Energy has been siting solar power plants with co-located battery storage at “nearly all” projects under development. In an interview earlier this year, Recurrent Energy head of energy storage development Lucas Moller said that “there is pretty much a fundamental need to add storage to every [solar] project to make it economically viable,” in the Desert Southwest areas of the US where the developer is most active.
In June, Recurrent Energy acquired two development stage BESS projects in Texas’ ERCOT market region, totalling 400MWh. The projects were bought from developer Black Mountain Energy Storage, which has since gone on to sell further ERCOT projects to fellow developer Cypress Creek Renewables and UBS Asset Management.
Elsewhere, in July Canadian Solar sold two permitted and construction-ready projects in the UK to alternative asset management firm Gresham House: a co-located solar PV and battery project with 50MWp PV and 38MW/76MWh BESS, along with a standalone 28MWp solar PV project.
CEO Qu said Q2 2022 is likely to be Canadian Solar’s biggest quarter for the year, based largely on the timing of project sales and battery storage shipments within the period, but the company expects profitability to “remain healthy through the second half of the year”.
The company is set to officially launch its own suite of utility-scale and residential BESS products at next month’s Solar Power International event at the RE+ 2022 trade show in Anaheim, California.
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