BYD (China) – Hao Lyu – 2018

Goals

BYD, the world’s largest manufacturer of electrical vehicles, wanted to explore opportunities for market penetration of energy storage products in the U.S. BYD’s Electric Power Research Institute (EPRI), which is primarily responsible for developing battery energy storage products for utility, residential and commercial purposes, hired EDF Climate Corps fellow Hao Lyu to analyze the U.S. commercial market for the adaptations of energy storage products in new and existing power solar photovoltaic power plants.

Solutions

Lyu conducted an in-depth analysis of the U.S. solar power market , focusing on the following four parts:

• Solar power market research
• Product operation strategy
• Annual revenue calculation
• Long-term return model

After conducting some background research, Lyu found out that the solar power capacity grew the fastest among the energy resources between 2016 to 2017, but only accounts for 2% of the total power generation. Due to this fact, he further identified the opportunity to couple the DC/DC converter and battery system with an inverter/smart control system, to gain additional revenue for PV power station. To determine implementing energy storage into both new and existing PV power stations in the U.S., Lyu quantified the NPV, IRR and PBT.

Potential Impact

The calculation of NPV, IRR and Payback Period of three different operation models of the power stations will help BYD make sound decisions about product launching, acquisition and marketing strategies in the US.