Recharging China ’ s Electric Vehicle Policy Tao Wang | Oct 30, 2013

1. Recharging China’s Electric Vehicle Policy Tao Wang | Oct 30, 2013 Resident Scholar, Energy and Climate Program

2. About Carnegie-Tsinghua Center • The Carnegie Endowment was founded in 1910, and established the Carnegie-Tsinghua Center in 2010 with the International Relations dept. of Tsinghua University • “The Global Think Tank” is headquartered in D.C., with five centers in three continents, and an Indian Center coming in 2013 • A private, nonprofit organization dedicated to advancing cooperation between nations. Its work is nonpartisan and dedicated to achieving practical results • Energy and Climate Program aims to 1) enhance mutual understanding; 2) promote cooperation; 3) provide independent and constructive policy analysis for energy and climate policies

3. Outline • International efforts on Electric Vehicle development • Policy comparison among China, Germany and the US • Lessons learned in pilot cities • Policy recommendations

4. Benefits from EV Development in China • Energy security • Environmental Protection • Climate Change Mitigation • Industrial Growth (leapfrogging in automobile industry)

5. Global Attention to Electric Vehicles (EVs) Total Investment in Public EV Infrastructure, 2010-13e ($m) Global EV Sales, 2012 (units) • Source: Bloomberg New Energy Finance • Source: International Energy Agency

6. Pilot Cities in China 2010年6月，6个私人补贴试点城市： 北京、深圳、上海、杭州、合肥、长春 6个私人补贴试点城市 Adapted from China’s Electric Vehicle Policy and Industry Plan, Xu Changming, State Information Center

7. Policy Comparison: Targets & Plans

8. Policy Comparison: Incentives

9. Policy Comparison: Sales

10. Lessons Learned in Pilot Cities • Lagged innovation results in an innovation capacity and technology gap • Insufficient impetus for Chinese automakers to focus on electric vehicles • Lack of infrastructure and incentives to use electric vehicles instead of conventional ones; purchase subsidies not in use • Relying too much on public finance support; lack of a sound business model

11. Latest EV Subsidy Policy since Sep. 2013 • The government will provide subsidies for public transportation and official vehicles. • These subsidies will decrease by about 10% in 2014, and then 20% in 2015encourage automakers to reduce prices of these vehicles in the longer term • In addition, 30% of new vehicles for municipal fleets must be electric. • Importantly, 30% of these newly subsidized purchases must be transacted with companies outside of the local regiondiscourage protectionism

12. Policy Recommendations: Open up the electric vehicle market to leading international automakers

13. Policy Recommendations: Promote electric vehicle use in commercial operations with priority

14. Policy Recommendations: Create an environment that encourages electric vehicle use Average Annual Total Cost of Ownership

15. Policy Recommendations: Develop a self-sustaining business model

16. Thank you! twang@ceip.org