Hainan, China’s southernmost island province, is considering a new set of policies it hopes will drive the adoption of swappable battery technology in the production, sales, and distribution of clean energy vehicles.
Why it matters: The move is the latest in a series of efforts to boost electric vehicle (EV) uptake by the Hainan provincial government, which has been pioneering aggressively pro-clean energy vehicle policies amid China’s rising profile in the industry.
- Hainan in March released China’s first provincial-level plan to completely ban the sales of gasoline-powered vehicles in all of its 19 cities and towns by 2030.
- Shen Xiaoming, governor of Hainan province on Monday in a media briefing reaffirmed this goal, and announced plans for upcoming energy projects excluding coal.
Detail: Hainan is working on a pilot program separating battery costs from electric car sticker prices. The plan is for customers to subscribe to a separate battery rental plan when buying these types of cars, China National Radio (CNR) reported Monday.
- The government said it would introduce “specialized companies” to offer battery-swapping services to citizens, but did not provide further details.
- China Association of Automobile Manufacturers will lead preliminary research on car registration, battery management, and technical standards for policy-making purposes.
- Chinese OEM BAIC and EV maker Nio recently spoke to municipal authorities about the planning and deployment of battery swaps, according to a government announcement released Wednesday.
- Some of the few early movers in the industry are betting on battery-swapping technology. BAIC operates 154 and Nio has 122 battery-switching facilities across the country.
Context: EV adoption is impeded by high ownership costs, and selling the cars with removable batteries lowers the vehicle purchase price. However, analysts have cast doubts about whether a battery swapping model could succeed globally given the issues around standardization and commercial feasibility.
- The model requires that automakers to agree on standardization requirements and entails additional logistical complexities. The majority of OEMs meanwhile prefer to control their design strategies for battery packs as part of their core technology.
- Boston Consulting Group estimated the adoption of fully electric vehicles may still be limited to specific applications such as commercial fleets by 2020, given the need for a widespread charging or swap-out infrastructure.