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Investing.com-- Shares of Contemporary Amperex Technology Co Ltd (CATL) (HK:3750) surged on Monday, boosted by China’s plans to almost double its new energy storage capacity to 180 gigawatts (GW) by 2027.
The National Development and Reform Commission and the National Energy Administration said on Friday that China will invest about 250 billion yuan ($35 billion) to support the buildout of battery storage and other technologies that are not based on pumped hydro.
The agencies said the expansion is needed to help absorb rising output from wind and solar power and strengthen grid stability.
China had about 95 GW of new energy storage capacity installed as of June, according to government data. Hitting the new target would mean nearly a 90% increase in less than two years.
Investors pushed CATL shares higher on expectations that the company, the world’s largest battery maker, will benefit from stronger demand for large-scale storage projects.
Hong Kong-listed shares of CATL jumped as much as 10.2% to HK$476.8, their highest level since listing in May.
Shenzhen-listed shares of the firm (SZ:300750) surged as much as 14% to 371.52 yuan, their highest level since November 2021.
Rival BYD Co (HK:1211) and other battery producers are also seen as potential winners as Beijing accelerates the deployment of renewable energy.
BYD shares traded nearly 4% higher in Hong Kong trading.