China's power storage sector is key to resolving the country's energy bottlenecks, S&P Global Ratings said in a recent release.
The sector will anchor wind and solar integration, lessen curtailment, and boost system reliability, S&P said.
Greater storage will also facilitate renewable power companies' shift to market-based pricing, the rating agency said.
S&P expects battery energy storage systems to grow faster amid a rise in the renewable energy mix that also includes pumped-hydro projects.
Independent power producers will see additional revenue sources through the battery projects, which will also hedge against increasingly unstable spot market prices, S&P credit analyst Scott Chui said.
Better economics and revenue visibility should encourage more energy companies to invest in power storage and narrow risks of intermittent renewable power, S&P said.
The rating agency expects players to sufficiently cushion against upcoming large investments, estimated at 1 trillion renminbi over the next five years, in line with their capital expenditure plans.