EVs to Join Power Trading –China Clean Energy Syndicate

Our picks of China clean energy market updates from last week: 

  • Net-Zero Policy: Net-zero action plans for specific industries, including iron&steel, building, transportation, petrochemical, and power, are under development.
  • Wind Power: At least 90 GW wind and solar capacity will hook to the grid in 2021.
  • Hydrogen: China’s first “Hydrogen Society” project kicked off in Shandong. Inner Mongolia’s Ulanqab strives to become a green hydrogen base to the Beijing-Tianjin-Hebei region.
  • Energy Storage: Beijing aims to explore EVs taking part in the electricity market trading, with battery changing stations the key players

Please scroll down for the 10 updates from last week.

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Net-Zero Policy

Beijing to Draft Net-Zero Action Plans for Electricity, Iron&Steel, Building, Petrochemical Transporation and Other Sectors

China’s economic planner, National Development and Reform Commission (NDRC), last week revealed that it is working on industry-specific net-zero roadmaps.

NDRC is drawing up “carbon emission peak” action plans for various industries, including electricity, iron&steel, petrochemical, building, and transportation, said Jin Xiandong, spokesperson for the NDRC.

China previously announced that it would strive to peak carbon dioxide emissions by 2030 and achieve carbon neutrality by 2060.

China Clarified Carbon Trading Market Mechanism with Three new Policies

The Ministry of Ecology and Environment issued three regulations (testing stage) on May 19, to set down the game-plays for the carbon market. The three encompasses administrative rules for the registration, transaction and settlement of carbon credits.

The regulations mark a critical step towards the final launch of the carbon trading market, industry experts said.

Some measures listed in the three regulations :

  • Carbon credits are based on the “price per ton of carbon dioxide equivalent” as the unit of measurement.
  • The smallest change in the declared volume of trading is measured as 1 ton of carbon dioxide equivalent.
  • The smallest change in the declared price is measured as ¥0.01.

Local media reported that China’s national carbon emissions trading market will be launched in late June after three years of planning.

Energy Iceberg’s Note: Former news regarding the launch of China’s carbon trading scheme.

Wind Power

90 gigawatt Wind and Solar will Connect to the Grid in 2021

National Energy Administration (NEA) last week announced that China has set a target for the grid operators to connect AT LEAST 90 GW of wind and solar capacity in 2021, as part of a new policy initiative aimed at meeting its low-carbon targets.

  • These projects are mainly existing projects (already installed but not yet connected to the grid). These projects were approved before 2020, of which most are subsidy-free or competitive pricing projects.
  • The grid companies are encouraged to connect more renewables in addition to the minimum 90 GW, as long as the projects are equipped with power storage or load-following facilities.

Offshore Wind Frontrunner SEWC Launched IPO, with Doubts on its Future Performance after the 2021 Installation Dash

A subsidiary of Shanghai Electric Group, the Shanghai Electric Wind Power Group (SEC Wind Power) last week successfully launched the IPO on the Science and Technology Innovation Board of the Shanghai Stock Exchange (SSE STAR). The firm saw its first-day trading to close at ¥11.75, up about 116%.

SEC Wind Power has been China’s largest offshore wind OEM, with its successful cooperation with Siemens Gamesa Renewable Energy (SGRE). Statistics in the prospectus showed that its offshore wind installed capacity in 2020 achieved 1.56GW.

Its 2018 to 2020 incomes: ¥6.171 b, ¥10.135 b and ¥20.685 b. The average revenue growth rate was as high as 54.15%.

However, as China’s wind installation dash soon come to an end, the market remains cautious over SEWC’s future performance.

Hydrogen

The Green Hydrogen Base for Beijing-Tianjin-Hebei Region: the Wind-Rich Ulanqab?

Ulanqab City of Inner Mongolia province recently issued a hydrogen industry development plan. According to the plan, the city envisions to, by 2025:

  • Infrastructure: to build at least six hydrogen refuelling stations–and to strive to build 13.
  • R&Ds: to promote the application demo and performance research of hydrogen production by proton exchange membrane electrolysis of water and overcome MW-level wind power PEM water electrolysis hydrogen production technology.
  • Power-to-gas: Relying on its large-scale wind power and photovoltaic base projects, establish a green hydrogen supply base in the Beijing-Tianjin-Hebei region.

Energy Iceberg’s Note: Ulanqab is a major wind power production centre in China, with the country’s largest wind power base project (6GW) developed by SPIC. Nevertheless, it is further away from Beijing-Tianjin-Hebei compared to another wind hub Zhangbei. The latter currently has 5 PtG projects already in place.

“Hydrogen Society” Program Funded by MoT Kicked off First Project in Shandong

Shandong Taishan Steel Group launched a hydrogen refuelling (main) station project and a fuel cell heavy-duty truck application project last week. The station would be the peninsular province’s first hydrogen main filling station.

The investment for the station is at ¥60m. The byproduct (coke) gas of Taishan Steel’s facilities will be recovered through PSA process and feed into the filling station. The filling station of 2400kg/D capacity will support nearby fuel cell trucks (150km.)

The projects mark the launch of the first “Hydrogen Society” program funded/supported by the Ministry of Technology.

Energy Iceberg Note: vice governor of Shandong province, Ling Wen, spoke at the launching ceremony of the project. Ling previously served as the head of China Shenhua and China Energy Investment Corp, a key figure developing Shenhua’s energy transition strategy.

A Net-Zero Highway project Kick off, Equipped with Wind, Solar, Hydrogen and Battery Storage

Tianjin Expressway Company kicks off a first-of-its-kind Highway Renewable project where 300MW wind and power facilities will be built along the highways’ service stations owned by the group. The project will also incorporate battery charging, hydrogen production facilities. The total investment is at ¥1.4b.

Energy Storage & Charging

China to Explore EVs to Participate in Electricity Spot Market

NDRC last week released an implementation plan on further improving the service capability of charging and changing infrastructure (feedback invitation draft). The plan averred that:

  • China set to have new energy vehicles (NEVs) to participate in the electricity spot market trading, by researching specific trading and dispatching mechanisms for NEV in the electricity system.
  • The policy also urged local regulators (who supervise pricing issues) to ensure the implementation of the peak-to-valley pricing of EV charging facilities.

The policy askes to speed up battery changing application: 1) to build stand-alone battery charging stations in mining, seaports, urban public transportation hubs and other short-distance, high-frequency and heavy-duty settings; 2) to develop shared charging business models for taxi and logistics market.

Clean Energy Relevant

China Targets Some Australian LNG as Trade Dispute Widens

At least two of China’s smaller liquefied natural gas importers have been told to avoid buying new cargoes from Australia, a further example of the impact on trade from souring ties between the two countries.

The firms have received verbal orders from government officials to avoid purchasing additional LNG from Australia for delivery over the next year, according to people with knowledge of the directive, who asked not to be identified as the details aren’t public.

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