Here is what La Repubblica, mainstream newspaper and influent media company in Italy, has to say:
From solar panels to batteries: China is the absolute master of cleantech
by Maurizio Ricci
The farewell of the diesel and petrol car sector and the energy crisis linked to gas and oil are pushing more and more towards electric motors and alternative energies. A game that currently sees Beijing as the only winner, thanks to large investments. And domination can allow the country to dictate the rules of the sector
02 JULY 2022
From 2035, no more petrol or diesel, Europe has decided. Our car will be electric. And Chinese, the BMW boss darkly points out. Not just the car, by the way. Our future is, in fact, in the hands of China. Or, to put it with less bass drum and more detail, cleantech - the clean technology, to which we entrust the hopes of avoiding climate catastrophe - has only one master and the name is written in Chinese characters.
In a recent Eurobarometer it was indicated that the slow decline of fossil fuels would give us a geopolitics no less unbalanced than the present one, with the materials destined to collect the legacy of gas and oil - from lithium to rare earths, to cobalt to hydrogen - concentrated in a few countries equally distant and foreign: from Congo to China to the Persian Gulf. But, if instead of looking at the materials to use them, the panorama is even more clear-cut and brutal: clean technology is already today, practically a monopoly, managed by Chinese companies.
It is as if, in the age of oil and gas, we had to take from Saudi Arabia and Russia not only petrol and methane, but also cars and boilers. This, in fact, The story that Wood Mackenzie analysts make of the solar panel production chain leaves no doubt. Polysilicone, which is the basic material of the panels: in 2010 China controlled 42 percent of its production, today we are 78 percent. Wafers, the layers in which the polysilicone is placed: between 2010 and 2021, from 78 to 98 percent. Cells, where the wafers are placed, from 60 to 80 percent. For assembled and finished panels, the market share has remained the same, but we are at 66 per cent. The situation is virtually the same as far as the heart of electric cars is concerned: the batteries. 90 percent of lithium, the mineral used for car batteries, is processed in China, which also covers 90 percent of the rare earth market, that set of oxides, magnets and metals, crucial for lithium batteries. The consequence is that three quarters of the car batteries produced in the world come out of Chinese factories.
This world domination over panels and batteries is confirmed by the aggressiveness of Chinese companies in investments. While the American, Australian, Korean groups are putting together a few hundred million dollars to spend on cleantech, in recent months, only three Chinese companies, active respectively in batteries, lithium and cobalt, are raising on the financial markets, to a large extent. from Western investors, at least $ 10 billion. The consequences will be measured shortly. Between 2021 and 2025, the share of Chinese companies in the global battery market will remain virtually unchanged, at 66 percent. But, in the same four years, the overall market will more than triple in size. In the same years, Europe, despite public commitments, This dominance may allow the Chinese to dictate the technical standards of the industry, further increasing their lead. As in the past for the United States, compared to the many European competitors, Chinese domination arises, first of all, from a massive internal market that ensures a strong demand rate and the level of production allows for low costs.
Chinese batteries have a production cost of $ 60 per kilowatt hour and the expected tripling of production will drop it to $ 50. The same economies of scale do not exist in the rest of the world and the average cost is $ 78 per kwh. In Europe, it goes up to 120 dollars. Korean carmakers themselves, who live side by side with battery giants like Samsung and LG, use Chinese batteries for 60 percent.
In terms of geopolitics, it is a situation that we know. Beijing aims to make China the cleantech Saudi Arabia, with the lowest production cost and the highest market share, just like the Saudis with oil.