Battery Swap Services have gone disruptive again, this time in China. On 18 Jan, the world’s biggest EV battery maker CATL showed off new brand EVOGO to expand on battery swap solutions. Last week, Geely Automobile established a joint venture with Lifan Technology, aiming for 5,000 battery swap stations by 2050, covering 100 cities. Other auto companies such as BAIC, SAIC, Changan and other OEMs have also invested in the model.
Unprecedented speed it is, but why? Battery swap stations may be an effort tried but failed by Tesla and Israeli start-up Better Place a decade ago, yet China EV makers’ take on the same challenge is more confidently backed by pouring government subsidies and soaring EV demands, providing alternative solution to alleviate EV range anxiety.
The 30% subsidy cut from purchasing end in 2022 already has resulted in increased pricing for Tesla , BYD and Xpeng in China. However, Cui Dong Shui, secretary-general of CPCA, believes it is a short-term phenomenon as technologies catch up quickly to consumer needs.
Last week, the National Development and Reform Commission and seven other departments jointly released the Promotion of green consumption implementation plan to build charging stations, battery swap stations, and new energy storage infrastructure. Since 2011, the government has been literally paving the way for commercialisation of battery swap services in China. Even oil and gas companies such as Sinopec have invested in battery-swapping infrastructure to prepare for energy transition.
Now, with the General Office of the Ministry of Industry and Information Technology issued to include 11 cities to promote building 1,000 battery swap stations, more mature business models began to materialise.
Already ahead of the game is NIO, with 818 battery swap stations in China as of 27 Jan 2022, plans to build more than 8,000 battery-swapping stations by the end of the year, 26,000 units by 2025. Important to note NIO’s Battery as a Service sales model (Baas), in which customers can buy EV without battery and pay a monthly subscription to access the battery swap network built within. The Baas service is much more than demonstrated on its first battery swap station in Lier, Oslo in the beginning of Janurary, swiftly switched for fully-charged battery in a matter of minutes, as drivers allow the station mechanics to navigate automatically for battery removal and replacement.
NIO’s ambitious scheme is more intricately woven. The separation between battery and vehicle allows charging stations and battery swap stations to serve as heart and blood vessels for premium user services, battery packs can also be utilised for energy storage in and outside of larger VPP (Virtural Power Plant) network.
According to General Manager of NIO Norway Marius Hayler, NIO is expected to build at least 20 identical battery swap stations in Norway by the end of 2022. Unofficial reports believe that as much as 92% of Norwegian NIO customers already opted for Baas when making purchasing decisions.
CATL, who makes 52% of all EV batteries worldwide, entered battery swap markets, hoping to hook partners with battery swap services that can be compatible with 80% of the vehicle platform models in the market and said to be extending its battery swap stations in 10 cities in China. At CATL’s swap station, users rent batteries based on actual mileage needs, taking as short as 1 minute to swap one choco-looking battery block, mass-produced with CTP technology.
Whilst densified urban planning and government support in China make battery swapping services a more attractive option, Chinese battery swap services providers are eager to explore battery swap solutions and beyond, seeking emerging opportunities on operation management, battery recycle and regeneration.
SEE ALSO: Would You Try Out EVOGO’s Choco-SEB?
