Full steam ahead for New Energy Vehicles in China
State Council issues circular on development of new energy vehicles to 2035
China's State Council released the government's policy "circular" for new energy vehicles to 2035 in late October, yet it seems to have had little coverage in the western media despite it's intended influence on the development of the New Energy Vehicles car sector in the world's biggest car market. As with many missives issued by the Council it's short on measureables but provides the overarching policy goals and implementation framework to guide those leading its realisation. Here are a few points from it that I think are interesting:
China wants to move from being a "major" car country to a "powerful" car country and the development of its New Energy Vehicles sector will contribute to achieving this goal whilst addressing climate change and promoting "green" development.
The circular calls for a "three verticals and three horizontals" strategy - the "verticals" comprising 1. pure electric vehicles, 2. plug-in hybrids and 3. fuel cell vehicles, with A. batteries and power management systems, B. drive motor and electronics and C. network connectivity and intelligent technologies as the cross-cutting "horizontals" for the three different types of vehicles.
By 2025, there will be (unspecified) breakthroughs in key technologies such as batteries, electric motors and operating systems, and the average power consumption of new EVs will fall to 12.0 kWh/100 kilometers. By 2025, New Energy Vehicles will comprise 20% of all new vehicles sold in China. By then, China's NEV brands will be competitive in international markets, electric vehicles will become mainstream in domestic markets, there will be new developments in fuel cell systems, and there will be wider application of autonomous vehicles technologies.
China wants to use NEVs as a platform for testing and developing new intelligent network technologies such as mapping and positioning, wireless communication (V2X) between the vehicle and equipment outside the vehicle, and wire control systems. It will promote the use of intelligent technologies throughout the NEV production and marketing process, from R&D to manufacturing, warehousing and transport to after-sales service. The plan calls for full use to be made of advanced technologies such as the internet, big data, and blockchain to improve product life-cycle quality control and traceability mechanisms.
On batteries, the circular includes:
• Encouraging enterprises to improve their abilities to guarantee supplies of key resources such as lithium, nickel, cobalt and platinum.
• Establishing and improving production systems for batteries, accelerating breakthroughs in manufacturing equipment, and improving processes and production efficiency.
• Improving battery recycling systems and encouraging the development of shared recycling channels.
• Establishing and improving battery transportation and storage, repair and maintenance, safety inspection, decommissioning and withdrawal, and recycling and utilization systems, particularly by strengthening the management of the whole life cycle.
......as well as developing appropriate legislation to support these improvements.
The circular also includes a specific push on the third "vertical" - development of hydrogen fuel cell technologies and infrastructure, both in-car and external system and infrastructures such as storage and refueling stations. However, as there are less than 10,000 fuel cell vehicles in China at present, this is a sector with much potential for progress and will surely remain in the shadows compared to electricity-powered vehicles in the renewables energy mix in the near future.
The full document is available here in Chinese - www.gov.cn/zhengce/content/2020-11/02/content_5556716.htm. It supersedes the "Energy-saving and New Energy Automobile Industry Development Plan (2012-2020)".