Battery industry in China

In 2015, the worldwide battery industry accounted for €73 billion. According to the Freedonia Group, this is expected to grow to €105 billion in 2019, with an annual rise of 7.7%. China is the largest market for batteries, as well as the fastest growing. This publication focuses on market players in China, innovation, battery recycling and government interventions related to the battery industry in China.

Full message 
The global battery industry was €73 billion in 2015, and is expected to grow. This boost is stimulated by a growing demand of batteries inConsumer electronic products, Auto applications, mainly hybrid vehicles (HEV), plugin hybrid vehicles (PHEV), and electric vehicles (EV), and Industrial applications, mainly storage batteries. Moreover, the battery industry is helped by technological developments, increasing disposable income of customers, new applications for batteries (wind, military etc.) and decreasing prices of raw materials for manufacturing latest battery products.

China is the largest national battery market, as well as the fastest growing. Due to the country’s massive manufacturing sector, particularly in the motor vehicle and electrical and electronic product industries, a rising output is expected. In addition, increased investment to expand electrical generation capacity is projected to boost battery sales, fueling purchases of battery-based backup power and energy storage systems.

Market players in China 
China is seeking to dominate the battery market by retaining the entire value chain of electric vehicles and batteries within the country. Local Chinese battery makers include BYD, BAK, Lishen, Wanxiang (related to A123), Shoto (Shuangdeng), Huanyu Tiger Head, Fengfan, Tianneng, Chongqing Wanli New Energy (CWNE), Camel, Shanghai Xinli, Zhongshan Long Way, HYB, B&K, DLG, Coslight, AEEnergy, among others. Shenzhen Institute of Advanced Technology (SIAT) is one of the institutes performing research on batteries.
Battery innovation in China 
Shenzhen Institute of Advanced Technology (SIAT) of the Chinese Academy of Sciences recently announced their newly developed, environmentally friendly, low-cost battery: the Aluminum-graphite dual-ion battery (AGDIB). “Compared with conventional LIBs, this battery (AGDIB) shows an obvious advantage in production cost (~50% lower), specific density (~1.3-2.0 times), and energy density (~1.6-2.8 times),” said TANG Yongbing, leader of the research team. The AGDIB mechanism follows a dual ion intercalation/alloying process.  AGDIB’s electrode materials are composed of environmentally friendly, low cost aluminum and graphite only, while its electrolyte is composed of conventional lithium salt and carbonate solvent. According to the research team, AGDIB shows potential for large-scale application in both electronic devices and electric vehicles. Their results have been published in Advanced Energy Materials.

Government interventions 
The Chinese government recently intervened with regards to the nickel manganese cobalt (NMC) lithium-ion battery, which is produced exclusively outside the country. Although it is not certain if this intervention will be upheld, currently it acts as a break for the NMC battery market in Chna. Since another variant, the lithium iron phosphate (LFP) is the most common chemistry manufactured in China, it is possible that the Chinese government would like to protect the locally manufactured variant. It favours domestic battery manufacturers such as BYD and Lishen who largely supply the LFP battery technology to electric bus manufacturers.

Battery recycling 
Since most batteries contain toxic metals in their electrodes, battery disposal creates major environmental problems. As China lacks a good working recycling system for batteries, hazardous waste is disposed. A lot of the batteries are collected by small, unlicensed vendors who recklessly dispose them after selling the lead to other manufacturers. Companies involved in the industry, both domestic and international, have urged local governments to crack down on illegal vendors and issue rules to force all the players in the industrial chain to comply with recycling standards.

According to a recent policy paper, China started to provide subsidies to companies that recycle batteries used in EVs. Companies also get government support for importing battery recycle machineries as well as their R&D on domestic recycling equipment and advanced recycling technologies. China is actively seeking international cooperation on battery recycling related technical standards and encourages foreign companies to demonstrate their advanced technology through pilot projects.

Sources, further reading
IBISworld report on Battery Manufacturing in China

Written by AvdS

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