New-energy Automobiles China: Charging Facilities Embrace an Intensive Materialization Period
As observed by the Urban Smart Transport Specialty Symposium charging infrastructures will become an emphasis of industrial policy support in the future: The support intensity and the extent of elaboration of industrial policies will be evidently enhanced, and a uniform central fiscal subsidy mechanism and policies in taxation support will be released.
As estimated, the industry-wide total investment demand of charging facilities during the period of the “Thirteenth Five-year” is between RMB 160 billion and RMB 180 billion. Currently, varied parties “haste for land acquisition” with varied patterns, and some insiders believe that the investment opportunity is mainly lying in the combination of the public transport system and the power distribution network development.
In recent years, the production and sales of China’s new-energy automobiles are increasing significantly year-by-year. As disclosed by data from the China Automotive Industry Association, the production volume and sales volume of new-energy automobiles in 2015 reached 340,000 and 330,000 respectively, representing a year-on-year increase of 3.3 times and 3.4 times respectively. However, there were only 3500 charging stations and 44,000 charging piles in the same period and the challenge of charging difficulty has become a bottleneck of the development of new-energy automobiles. In contrast, established charging piles are left in idle for long without being used.
Against the dilemma of co-existing between idle charging piles and charging difficulty, after the top level design was gradually specified in the first half of the year, according to incomplete statistics, there are 18 provinces and 45 cities which have enacted specialized planning or management rules for charging infrastructures and 20 provinces and cities which have formulated relevant criteria of subsidy, across the nation.
Charging Facilities to catch up on E-Mobility
Li Lili, deputy director of State Grid Energy Research Institute Electric Power Development Planning & Design Research Institute, believes that, under the context that most of domestic industries are in the “red sea” competition, intelligent transport related industries will be a promising “blue sea” market in the future. In following steps, the strength of policy support and the extent of elaboration of charging infrastructures will be evidently enhanced; local fiscal subsidy mechanisms will be first materialized in key areas; investment subsidy will be gradually converted to power subsidy; and it’s expected that a uniform central fiscal subsidy mechanism and taxation support policies will be released.
According to his estimate, China will build 20,000 – 23,000 charging stations and 5 – 5.5 million charging piles from 2016 to 2020, and public charging networks will fully cover key cities and regional expressways, taking other areas into account. Industry-wide total investment demand will be around RMB 160 billion to RMB 180 billion, and annual investment demand will be RMB 32 billion to RMB 36 billion. In the period from 2021 to 2030, 140,000 – 160,000 charging stations and 50 – 57 million charging piles will be built, industry-wide total investment demand will be RMB 640 billion to 730 billion, and annual investment demand will be 64 billion to 73 billion, which doubles that of the “Thirteenth Five-year”, and the rate of return on investment in the industry will increase rapidly.
“The situation before was that there were not a great number of vehicles and as a result the developed charging piles couldn’t make profit. Since this year, policy strength is exerting continuously which turns the tide, and many enterprises now are encouraged to “haste for land acquisition”. Private enterprises lead the market by prevailing investments at first, then state-owned enterprises and central enterprises are mobilized as well,” says Wen Longxin from Beijing Enterprises (Hainan) Clean Energy CO., Ltd.
Guo Jingpu, general manager of Xinda Securities R&D Center, believes that the investment opportunity involves two aspects. Firstly,,the public transport system is highly sensitive to operation costs, and certain rate of return on investment can be available in addition to corresponding charging network development and operation costs, provided the current low-cost system; secondly, in the energy network framework, charging network development shall be combined with upgrade and renovation of stock distribution networks and planning and development of newly increased distribution networks.