Published on July 7th, 2018 | by Tim Dixon0
China X Cleantech — End of Q2, 2018
July 7th, 2018 by Tim Dixon
China is the hottest kid on the block when it comes to cleantech. As such, we try to keep an exceptionally close eye on what’s going on there and share regular reports of the most significant news of the past month or quarter. We call this series China X Cleantech. You can subscribe to the China X Cleantech newsletter here.
The second half of Q2 2018 has been notable and the flood of news from around the world continues. In China, the flood of developments is so massive that we can only show you a keyhole insight into what has been happening there.
China has been the driving force behind the global growth of of solar power recently. In 2017, it represented 53% of new global installed capacity, up from 45% in 2016, but its leadership might be impacted by China’s new solar policy.
It was reported that Taiwan-based market research firm Energytrend revised its forecast for China’s new capacity additions, which led to a cut in its global forecast down from 106 GW to 92–95 GW. Other research firms have been cutting their estimates for China’s 2018 installations by around 20 GW!
In late April 2018, the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA) announced that a cap would be placed on feed-in tariff eligibility for new small-scale solar projects for 2018, and that the country’s feed-in-tariff (FiT) would be reduced. [This sentence has been updated after publishing.]
This is an effort to cool the market and reduce oversupply in China and the world markets.
Despite the other forecast downgrades mentioned above, though, IHS Markit predicts that the global solar market will increase by around 11% to 105 gigawatts (GW) in 2018 despite the changes to China’s solar policy.
April registered units were up 129% year over year (YOY) and May registrations were up 127% YoY. Sales overall for 2018 are more than double that of the same period in 2017, with EV market share up to 3% for the first 5 months of the year.
Electric Car News
Electric car news comes thick and fast in China, which is not shocking once you realize that half of global electric vehicle sales happen in China. That market keeps growing with the Q2 2018 list of cars that can access subsidies. I was able to find 8 new electric and hybrid cars to introduce to our audience, and that was just for the month of March.
We also got more information on GM’s long-term vision for electrification in China. It was reported that GM has committed to offering 10 electrified models by 2020 in China and that Matt Tsien, head of operations for GM in China, told the press in Shanghai that the company has plans to launch 10 more heavily electrified vehicle models in China between 2021 and 2023. “Clearly, we have a strategy in place and there is an implementation in place to do that,” Tsien said.
This is a general trend in China — both local and international players are committing to electrification of vehicles.
Magna, a car manufacturing giant that’s main business is making cars and major car components for other companies, has formed a joint venture with BAIC’s electric vehicle subsidiary, the Beijing Electric Vehicle Company (BEVC). It will manufacture electric cars for BEVC in China.
Each story about joint ventures, new electric vehicles, and electric vehicle platforms is not just a story but, within the car industry, it is building understanding and knowledge that will feed into the next generation of business decisions and technologies.
BYD, which has been developing and creating batteries for 23 years, has opened a new 24 GWh battery factory in Western China’s Qinghai province. It aims to ramp up production to a total of 60 GWh by 2020. The Qinghai province joins BYD’s two existing battery factories in Shenzhen and Huizhou.
Another company with long-term vision and an eye on global domination, CATL, got in the news about a €1 billion battery contract with BMW. There were separate rumors about an independent €1 billion factory. But these are probably news items about the same thing.
Samsung SDI is the current supplier of BMW. The rise of CATL should not be ignored by global leaders. China’s industrial policy and corporate policy is focusing on the long-term future of this sector and next-generation industries, and that certainly includes CATL, which aims to become the world’s largest EV battery manufacturer.
That the deal will finance new capacity in Europe shows that CATL has sights set on not just the gigantic Chinese market but the European market as well, and surely more.
Another technology that the Chinese government is pushing hard to develop for future economic supremacy is autonomous driving technology, and artificial intelligence in general. Each month, new stories about autonomous vehicles (AVs) in China are popping up.
Steve Hanley recently wrote about Tencent getting an autonomous car licence in Shenzhen and BMW getting an autonomous car licence in Shanghai. The latter makes BMW the first foreign company to get a licence.
Nicolas Zart also introduced the news that Byton, a Chinese EV startup, is positioning itself as an international company by promising to release its all-electric SUV in 2021 with L4 autonomous driving capabilities. The article then dives deep into the overall malaise around overhyped predictions and lack of solid products to match promises.
China’s environmental policies are constantly evolving, and it has major development plans that are certain to disrupt the environment. This quarter, we have a couple of developments to discuss.
Nexus Media interviewed William F. Laurance, a biologist, to gain insights into the possible ecological dangers around China’s massive global infrastructure project. Laurance goes into how this $8 trillion mega project, made up of 7,000 projects across Asia, Africa, Europe, and the South Pacific, might influence those regions.
Joshua S Hill also reported on €300 million framework loan between The European Investment Bank and The Export-Import Bank of China. The loan is aimed at spurring additional financiers to provide up to €1 billion to help China finance carbon emissions reductions and improve environmental protection.
Other Corporate Cleantech News
Large companies continue to procure large amounts of renewable energy, energy storage, and electric vehicles globally, and that is no less true in China. Along those lines, Samsung announced that it intends to source 100% renewable energy across all sites in the United States, Europe, and China by 2020. This was after global protests and campaigns to get Samsung to change. Interesting news for corporate sustainability and how people can help motivate positive changes in the world.
Tesla was rumoured for many years to be looking to build a factory in China for local production, but until recently most foreign automakers created joint ventures with Chinese automakers. On the 15th of May, Steve Hanley reported that Tesla had created Tesla Shanghai Co. Ltd, which is a wholly owned subsidiary of Tesla HK. Tesla has yet to formally announce anything.
Tesla’s not the only foreign automaker growing in China, though. Volkswagen has released news that it is expanding its existing factory, Foshan Plant, pushing its capacity from 300,000 to 600,000 cars. It is focusing the new capacity on sport utility vehicles and electric vehicles.
Kyle Field reported on the BYD press event the BYD Dreams Gala. At the event, BYD announced that it intended to release the technology for 341 sensors and 66 controllers for its DiLink system. The release on an open platform is intended to encourage other companies to adopt a standard platform for the development of electric vehicles.
One episode back: China X Cleantech — 1st Half of Q2 2018
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