The direct and indirect costs of air pollution in China are significant and growing with increased urbanisation and production. As one of the major contributors to PM 2.5, reducing traffic exhaust fumes is a clear priority of the Chinese Government, and promoting the use of New Energy Vehicles (NEVs) is a good place to start. As a central part of the Made in China 2025 initiative, Jeroen Pynenburg of ABB looks at impact the NEV sector will have on China’s overall development goals over the coming years.
In Beijing (and many other Chinese cities), up to a third of the city’s PM2.5 pollution is caused by vehicle exhaust fumes, according to the Beijing Municipal Environmental Protection Bureau. In response to this dire problem, China’s central government has embarked on a number of initiatives aimed at significantly reducing air pollution through focussed interventions, and it is this determination that could see China take a leading position in the New Energy Sector. Hopefully it will not be too long before the investments made today start to pay us back in cleaner air.
The number of people working in industries related to renewable power generation and efficient power use is growing rapidly; of these, the NEV industry is one of the more important and attractive ones – clean energy vehicles and equipment has been prioritised in the Made in China 2025 plan. It is set to influence the lives of billions, and bring disruptive change.
Within the next five years the automotive and energy industry in China, and indeed the world, will see more change than in the last 50 years. Car manufacturers will need to commit to producing electric cars and power companies will need to commit to renewable generation and efficient storage of electric energy.
Electric mobility will contribute significantly to the ultimate goals of reducing pollution and improving the quality of life in China’s cities, and throughout the entire country. However, although this is an inevitable shift, it will not be easy to change the mobility habits of 1.3 billion Chinese people, many of whom have only just started to get used to owning cars.
So, what is happening and why will it happen fast?
An internal combustion engine peaks at ~30 per cent efficiency while burning fuel in its cylinders. This is the result of a century of continuous advances and trillions of dollars in research and development. The room for improvement that’s left in combustion engines is minimal. Yet, even though still in their first generation, electric cars can comfortably reach efficiency levels of 85–90 per cent – at least three times more energy efficient than conventional engines. This clearly demonstrates the tremendous potential of the electric car, in addition to the benefits fast acceleration, very low maintenance costs due to a large reduction of moving parts and no noxious exhaust fumes — and it could be driven on pure sunlight.
Since the introduction of the first series of mass-produced NEVs around 2010, many car manufacturers in China have been creating plans to introduce a completely new generation of electric cars and/or electrify existing models. China is even taking the lead in a number of initiatives and is mobilising the entire industry for change. More than 170 model launches are scheduled over the next three years by all major manufacturers. This represents a significant effort for these companies that have their capital invested in expensive production lines that produce gear boxes and petrol engines, and oil companies that are valued on reserves for the next 30 years. We now need batteries, electric motors and solar farms, instead.
There is a clear clash of ideologies among the ‘petrol heads’ that prefer the sound and power of a 6-cylinder and the environment lovers that believe in the cleaner electric variant delivering the same power, and even better torque, the instant the pedal hits the metal. I am certain which technology will prevail.
Consumers will soon be faced with the choice of either a fun, rapidly-accelerating electric car, which can be charged on pure sunlight and which might even earn some tax breaks, and an ordinary, heavily-taxed, fossil-fuel car which is banned from entering city centres and is decked out with expensive emission control systems.
Currently, the price of electric cars is mainly driven by the price of the battery; all the other components are at least of equal, but in most cases even lower, value to those on conventional cars. Technology like digital cameras and solar panels were once expensive, but not anymore. These technologies followed a steep ‘learning curve’ but declining costs soon took effect. A similar development is expected for the electric car. Over a 10-year period, starting from 2010, with a price of USD 1,000 per kWh capacity in the battery, it is now projected that costs will be only one tenth of that in 2020 at around USD 100 per kWh. This disruptive development will put the electric car within the reach of most people. The first movers in the industry will soon be offering cars at price levels that are competitive.
If mainstream acceptance of electric vehicles is to become a reality, consumers must feel confident that replacing their conventional vehicle with a NEV alternative will not be financially disadvantageous, leave them stranded on the way to work or otherwise restrict their mobility options. This means that a credible charging network will be a crucial pillar to further accelerate the adoption of NEVs. Today’s NEV batteries can provide up to a 150km driving range and can be charged in 25 minutes. With the application of new technologies, within the next 10 years battery sizes will triple and charging times will be reduced by half or even two thirds. The result will be charging times that are 6-10 times faster than today’s. Charging a battery will be almost like fuelling a car.
Add to the price and performance arguments in favour of electric mobility, the pressure from an ever-growing group of people advocating a cleaner environment, and we have all the ingredients for the disruptive electrification of mobility. Only the parties that play along will deserve a place in the mobility value chain of the future: for China, that future looks very bright. The people are ready for the transition and the government is launching a number of measures and policies to support electrification. This presents an excellent opportunity to even play a significant role on a global scale.
ABB is a leading global technology company in power and automation that enables utility, industry, and transport & infrastructure customers to improve their performance while lowering environmental impact. The ABB Group of companies operates in roughly 100 countries and employs about 135,000 people. ABB has a full range of business activities in China, including R&D, manufacturing, sales and services, with 18,000 employees, 40 local companies and an extensive sales and service network across 147 cities.