Electrolysis, NaCI, Heavy-Duty FCVs the Investment Directions — China Clean Energy Syndicate

Chinese policymakers have unleashed several critical net-zero energy and industry policies in recent months (and more are expected to be announced by the end of 2021). The policy changes, against the backdrop of China’s “Dual Carbon” revolution, has triggered various new investment hypes.

Last week’s news updates highlighted some of these “net-zero” investment directions.

  • Net-Zero: Electricity pricing reforms would add trillions of new investments in Energy Storage, Wind, Solar, and Electrolytic Aluminum, NDRC officials stated. The commission is researching on new “green electricity pricing.”
  • Renewables: Haizhuang Wind Power (of CSSC) Launches Asia’s Second 10MW Offshore Wind Turbine Prototype
  • Hydrogen: Commercial heavy-duty FCVs, electrolysis equipment are the two major investment directions in China’s hydrogen market, as industry leaders come to a similar point of view.
  • Energy Storage & Battery: NaCI battery attracts investment from the major lithium-ion players.

Scroll down to check out the 9 updates that we considered noteworthy last week.

For those who do not know us: China Clean Energy Syndicate is a weekly news update project developed by Energy Iceberg. We also offer free analysis on China’s renewable, electricity market, hydrogen, and energy storage. The analytical articles are shared every fortnight. Check out our website to subscribe:


Net Zero

Fuel Cell Heavy-duty Commercial Vehicles the Key Investment Direction

Industry experts shared the same vision that fuel cell technology should be mainly applied in China’s heavy-duty business vehicles, when it comes to the decarbonization reform of the transportation sector, as leaders gathered in the 2021 World New Energy Vehicle Congress last week held at Hainan province.

China’s Vice Premier Han Zheng made a keynote, where he urged the industry to make breakthroughs in fuel cell technology bottlenecks.

[Energy Iceberg Note: the speech reflects the current industry investment emphasis on the eight fuel cell manufacturing technologies, including PEM, MEA, compressor, carbon paper, and so on. ]

There are three key takeaways we understood from the officials of the Ministry of Ecology and Environment (MEE) and others.

  • China’s transportation sector contributes 60% of the country’s total nitrogen oxide emissions. Commercial vehicles are not only the main nitrogen oxide emission contributor among all motor vehicles, counting 96% of the total nitrogen oxide emissions, but also a major contributor to the VOCs emissions.
  • The number of medium and heavy vehicles in China only accounts for 4.3% of the total number of vehicles. However, their share of nitrogen oxide emissions exceeds 90% of the total amount. Diesel vehicles account for 78% of the total nitrogen oxide emissions and 65% of particulate matter. They are the next targets for regulation. (MEE official)
  • Statistics of China’s real-time commercial vehicle public supervision and service platform show that there are a total of 7 million heavy-duty trucks in the country. It is estimated that there are about 2 million urban delivery vehicles under 4.5 tons. 

Electricity Pricing Reforms Would Trigger Trillions of New Investment in Energy Storage, Wind, Solar, and Electrolytic Aluminum Sectors?

China’s top economic planner, National Development and Reform Commission (NDRC), has successively introduced several electricity pricing reforms since May this year,including new pricing mechanisms for pumped hydro storage, peak-and-valley electricity power pricing, tiered price policy for the electrolytic aluminium industry as well as zero-subsidy pricing policy for renewable power.

At the moment, the NDRC is speeding up the research of green electricity pricing and aiming to improve pricing mechanisms for nuclear power as well as catalogue electricity retail prices.

On the NDRC regular press conference in September, Peng Shaozong, deputy director of the Price Department of NDRC, stated that these electricity price reform measures would effectively stimulate investment into pumped storage, wind, photovoltaics, new energy storage construction, and energy-efficiency technological transformation in the electrolytic aluminium industry. Peng said that energy storage, wind & solar would see trillions of private investments triggered by these reforms in the next few years.

NDRC Asks for “Double Controls” both on Energy Intensity and on Renewable Consumption Share

NDRC recently published a plan to limit the total amount of energy consumption and set targets for lowering energy intensity (‘dual control’ policy).

The plan would be an important institutional document that guides energy conservation and consumption reduction work and promotes high-quality development.

Wind Power

Chinese OEM bring forth Asia’s Second 10MW Turbine Prototype–or the First 10MW Prototype with +100m Blades

CSSC Haizhuang Wind Power (formerly CSIC Haizhuang) last week held a product launching ceremony for the H210-10MW offshore wind turbine in Zhuanghe, Dalian city of Liaoning province, as the prototype came off the production line.

By the launch, Haizhuang becomes the second Chinese OEM with a 10MW turbine product. Previously, Dongfang Electric become the first who launch China’s (or Asia Pacific’s) first 10MW turbine.

Haizhuang claims that the prototype:

  • Has the longest rotor blade diameter in China.
  • Pertains the world’s largest sweeping area per kilowatt.
  • Is the ideal 10MW-level turbine model for China’s zero-subsidy offshore wind power market.

Energy Iceberg Note: Dongfang Electric has been the first to develop a 10MW offshore wind turbine among Chinese OEMs. The blade of the DEC product was around 90m.

Hydrogen & Fuel Cells

China Might See the First Waste-to-Energy Green Hydrogen Project Soon

Dongfang Boiler Group (a subsidiary of Dongfang Electric) and the local government of Tongnan District of Chongqing City last week signed a letter of intent for cooperation. The duo will jointly develop China’s first commercial hydrogen production project based on waste-to-energy.

Electrolysis Equipment the New Investment Hype

Recent statistics from the China Hydrogen Energy Industry Association show that:

  • Domestic hydrogen production in 2021H1has jumped up 25% YoY and the proportion of renewable power-to-gas was 30% higher compared to that of 2020H1.
  • Power-to-Gas’ significant market inroad s has lead to the demand increases of electrolyzers and other equipment.

Bloomberg New Energy Finance (BNEF) recently stated in a new report that due to China’s amazing growth 2021H1, the size of the electrolyzer market is expected to double this year and reach at least 1.8 GW in 2022. China is expected to account for 60%-63% of the global installed capacity of electrolyzers.

Check out our Monthly Subscription on Green Hydrogen in China

Ministry of Science & Technology Launches “Hydrogen Community” Program with ¥150 Million

The MoST has kicked off the application process for the Hydrogen Technology Major R&D Program, which is part of the National Major Technology R&D Program.

According to the notice last week, the ministry plans to kick off one specific “Hydrogen Community” demonstration project with ¥150m financial support. Nevertheless, companies who applied for the demonstration would need to provide three times (¥450m) the funding and secure another ¥150m from the local government. That means the chosen demonstration project would have a total investment of at least ¥750m. The total demonstration period is 4 four years.

The “Hydrogen Community” demonstration aims to achieve the following targets:

  • 3000 FCVs and 15 refuelling stations would be in operation.
  • The combined driving range of the FCVs exceeds 100 million km.
  • The consumption of hydrogen gas would exceed 10,000 tons.
  • Hydrogen consumption for fuel cell combined heating and generation (CHP) units would also exceed 10,000 tons.

Energy Storage & Battery

NaCI Battery: A New Rising Star

Recently, the sodium-ion battery (NaCI) industry has been attracting investment from major lithium-ion players.

China’s top policy planners, NDRC, the Ministry of Industry and Information Technology (MIIT) and other departments have recently stated that they will take actions to promote the development of innovative batteries such as sodium-ion.

In the awakening of the policy signals, the sodium-ion battery sector is witnessing a rising investment appetite. Previously, Contemporary Amperex Technology (CATL), China’s largest automotive lithium-ion battery maker, and other industry giants set foot in the new area.

In addition, Jiangsu, Shanxi, Guangdong and other local governments are also accelerating the deployment of the sodium-ion battery industry, and have initiated the construction of related projects in some industrial parks.

CATL Reportedly Bids for Canadian Lithium Miner Millennial for About $300 Million

Chinese battery maker Contemporary Amperex Technology Co., Limited (CATL) was the mystery suitor behind the C$377 million ($298 million) offer for Vancouver-based Millennia.

A bidding battle for Millennial is heating up as Chinese firms compete to secure key elements needed for electric-vehicle batteries. Millennial revealed on September 8th that it had received a non-binding offer of C$3.85 per share from a foreign lithium-ion battery manufacturer who was unwilling to be named. The second highest offer also came from a Chinese company. China’s Ganfeng Lithium Co. offered to buy Millennial for C$353 million, or C$3.60 per share this past July. On July 30th, Ganfeng Lithium Co. announced its subsidary Jiangxi Ganfeng Battery Technology Co., Ltd. had received more funding from investors led by Hubei Xiaomi Changjiang Industrial Investment Fund Management Co.