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In Depth
Chinese companies are scouting the world for mining assets as the country’s booming new-energy vehicle industry has boosted demand for key metals used in electric-vehicle batteries. However, receding globalization, rising geopolitical conflicts and supply chain restructuring is throwing up road blocks for investing in overseas mining projects. Read here for how Chinese companies learn to “walk on two legs” at home and abroad.
Top News Items
China to expand its EV charging network
The National Energy Administration (NEA) has vowed to accelerate the cutting-edge design to further develop the country’s charging infrastructure for electric vehicles (EVs). A spokesperson for the NEA disclosed that China’s charging infrastructure for EVs nearly doubled in 2022. The number of charging units increased 100% to 5.2 million, including 1.8 million public charging facilities and 3.4 million private charging piles. Last year, 650,000 public and 1.9 million private charging facilities were installed, the spokesperson said.
At the end of 2022, 13.1 million private EVs were on the roads in China. However, the unevenly distributed layout of public charging facilities and irregularly operated charging market hinder further development.
China promotes EVs in rural areas to boost consumption
China unveiled this week its “No. 1 central document” (关于2023年全面推进乡村振兴重点任务的意见). Meaning first of the year, the document is issued by the central government and typically addresses agricultural issues. Among the policies to guide agriculture and rural issues this year, the promotion of new-energy vehicles (NEVs) and green smart home appliances in rural areas was highlighted.
In 2022, NEVs, a category that includes EVs and hybrid vehicles, developed significantly in the country’s big cities. With the gradual maturity of the industry, the government is pushing for its scope to broaden to rural areas.
China’s renewable energy capacity overtakes coal for first time
China’s renewable energy generation capacity edged out coal power capacity for the first time last year, with new solar driving the electricity sector’s efforts to reach ambitious carbon emissions goals even as the removal of subsidies dragged on growth in wind turbine construction. Renewable energy, a category that in China also includes nuclear and hydropower, accounted for 47.3% of China’s total installed generation capacity by the end of 2022, with coal accounting for 43.8%. Taken together, newly installed solar and wind power capacity hit a record 125 million kilowatts (kW) — an increase of about 22% on the previous year, marking the third consecutive year the figure has exceeded 100 million kW.
More securities firms win approval to trade in the carbon market
The China Securities Regulatory Commission (CSRC) approved six securities companies to participate in carbon emission rights trading. Among them, China International Capital Corp., Citic Securities Co. Ltd., Shenwan Hongyuan Securities Co. Ltd., Huatai Securities Co. Ltd. and Orient Securities Co. Ltd. announced they had received a letter of “no-objection” from the CSRC. Following the latest approvals, there are at least eight securities firms allowed to trade carbon emission rights. The approvals could help boost liquidity in the nascent market and promote market price discovery.
Notably, the primary regulator of the carbon emission trading market is the Ministry of Ecology and Environment, not the CSRC. The issuance of the “no-objection” letters from the latter only allows securities firms to conduct self-operated business related to carbon trading, rather than entering the carbon market as participants.
Ford to partner with China’s CATL for new EV battery plant in Michigan
Despite tensions between the U.S. and China, Ford Motor Co. said Monday it will collaborate with Contemporary Amperex Technology Co. Ltd. on a new $3.5 billion plant for electric-vehicle batteries in Michigan. CATL, the world’s biggest battery-maker, will provide services and knowledge for the construction and operation of the plant, which will be wholly owned by Ford. The U.S. automaker is investing $50 billion to develop and build electric vehicles and plans to produce 2 million a year by the end of 2026.
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