Our top picks of China clean energy market updates from last week:
- POLITICS: US added China National Offshore Oil Corp (CNOOC) in the “military defense” blacklist which might open the door for sanctions against the oil company–which is also a raising renewable player
- WIND: Military factor in the South China Sea complicated the development of offshore wind in the region and already delayed at least 6.4GW projects of Guangdong
- HYDROGEN: Expert three-fold its previous prediction of China’s H2 refuelling station figures, now believing that 1,000 stations would be up and running by 2025; meanwhile, a recent study shows end-user gas price could be as low as ¥25/kg.
- EVs: Tesla announces to build a new factory to produce Supercharger V3 in China soon after getting green-light to sell its Model Y electric crossover in China.
Please scroll down for the ten updates last week.
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The 2020 China Electric Power Development Forum was recently held in Beijing. The conference focused on the development of electric power industry during the 14th Five-Year Plan (14th FYP).
On the forum, LI Jun, deputy dean of the Economic and Technical Research Institute of the Global Energy Internet Development Cooperation Organization, delivered a keynote speech on China’s energy transition and the 14th FYP power planning research. Li mentioned possible wind power planning goals for the 14th FYP:
- By 2020, China would put in operation of 40GW of wind power.
- By 2025: China could add 290 GW of power into operation during the 14th FYP (2021-2025); By 2025, the cumulative capacity of wind power would reach 540GW (including about 30 GW of offshore wind), with an average annual increase of more than 50GW.
- By 2035, wind power installed capacity would reach 1.107 TW, accounting for 25% of total power capacity.
- By 2050, wind power installed capacity could reach 1.967 TW, accounting for 33% of the total planned amount.
- Between 2021-2035, the average annual incremental installed capacity would exceed 59 GW.
- Between 2035-2050: 57GW annual increase.
Local Development and Reform Commission (DRC) of Jieyang City in Guangdong Province last week announced to postpone the approval of 8 offshore wind projects totalling 5.85GW.
Six of these ten delays are due to military reasons in the South China Sea.
In Aug. 2020, State Power Investment Corp’s (SPIC) 150MW Jinghai and 400MW Shenquan offshore wind farm projects were also delayed due to disapproval from the “military side”.
Jieyang, by now, has decided to postpone ten projects totalling 6.4GW.
Sinoma Science & Technology (Sinoma) last week announced a share-trading suspension notice due to an M&A of Lianyungang Zhongfu Lianzhong Composite Materials Group (Zhongfu Lianzhong).
In 2017, China National Building Material Group (CNBM, the parent company of Zhongfu Lianzhong) merged with China National Materials Group (the parent company of Sinoma). CNBM promised to conduct business integration within three years to solve the problem of horizontal competition.
Sinoma will become the world’s largest wind turbine blade manufacturer after the M&A of Zhongfu Lianzhong.
Hydrogen Storage & Fuel Cells
The third Great Wall World Renewable Energy Forum (GWREF) was held in Zhangjiakou last week. Wang Hewu of Tsinghua University put forward two predictions for China’s hydrogen market:
- Hydrogen refuelling stations: The number of hydrogen refuelling stations in 2025 and 2030 would reach 1,000 and 5,000 respectively, which is much more than the original estimation (at 300 and 1,000 respectively).
- Hydrogen gas production direction: Hydrogen industry would focus on renewable power-to-gas. In the near term, China would endorse the ‘blue-hydrogen approach’ (hydrogen production from natural gas) to meet the high demand for hydrogen supply. However, Wang argued that the blue-hydrogen approach would not recommend if the large-scale economic application of carbon capture and utilization technology does not exist.
Research institute EVTank released a report on China’s hydrogen energy industry. Report analysis believes that the full-value-chain cost of hydrogen gas (from production, storage, transpiration to refuelling) could reach ¥25/kg under ideal circumstances.
Air Liquide China last week signed a Comprehensive Cooperation Agreement with Sichuan China National Nuclear Guoxing Technology in Chengdu, to further develop the hydrogen energy industry chain in Southwest China, especially the renewable hydrogen energy industry. In the context of this agreement, the two companies will cooperate over the whole value chain.
Linde and the Dalian Bingshan Group Partner On Hydrogen Station Development
Linde and the Dalian Bingshan Group have signed an agreement to establish a new joint venture company to manufacture hydrogen refuelling stations in Dalian, China.
EV & Battery
Guodian of China Energy Investment Corp (CEIC) last week launched a battery storage tender for its Zhugensha H1# offshore wind farm.
CEIC plans to construct a battery energy storage system to the AC 35kV system side of the Guohua Yigang wind farm booster station. The design capacity is 10MW/20MWh, the tender document disclosed.
This project could be the first battery storage unit for an offshore wind farm in China.
Tesla is planning to invest in ¥42m to build a new factory to produce Supercharger V3 stations in China as it rapidly expands its charging network. Initially, Tesla was producing its Supercharger stations in Fremont, California. With the launch of the Supercharger V3 last year, the automaker moved production to Gigafactory New York, where it also produces its solar roof tiles.
Tesla China VP TAO Lin suggested at an online forum that Tesla would produce about 10,000 Superchargers next year, which is more than the sum of all the superchargers installed by Tesla in China in the past few years. Tao also said that Tesla Shanghai factory is now producing Supercharger V3 stations with the fastest charging speed.
Notably, Tesla has gained approval to sell its Model Y electric crossover in China, according to documents published by the Chinese ministry of industry and information technology last week. Tesla has applied to sell the Model Y in China in early November.
China’s third-biggest oil company faces a U.S. blacklist, which could spur significant outflows from its Hong Kong-listed unit, after years of involvement in offshore drilling in disputed South China Sea waters.
China National Offshore Oil Corp. (CNOOC), the nation’s prominent deepwater explorer, is among four companies to be added to a list of firms owned or controlled by the Chinese military, Reuters reported. The move comes as the Trump administration plans several new hard-line moves against Beijing in the final weeks of its term.
CNOOC hasn’t yet received any official notice or decision from any relevant U.S. government agency, the firm’s listed unit said in an exchange filing in Hong Kong. “The company is closely monitoring the development of the situation,” it said.