February/March 2021

MARKET NEWS 9 www.power-mag.com Issue 1 2021 Power Electronics Europe According to a new measure of ‘energy transition investment’, compiled by BloombergNEF (BNEF), shows that the world committed a record $501 billion to decarbonization in 2020, beating the previous year by 9 percent despite the economic disruption caused by the Covid-19 pandemic. BNEF’s analysis shows that companies, governments and households invested $303 billion in new renewable energy capacity in 2020, up 2 % on the year, helped by the biggest-ever build-out of solar projects and a $50 billion surge for offshore wind. They also spent $140 billion on electric vehicles and associated charging infrastructure, up 28 % and a new record. Other areas of energy transition investment also showed strength. Domestic installation of energy-efficient heat pumps came to $51 billion, up 12 %, while investment in stationary energy storage technologies such as batteries was $3.6 billion, level with 2019 despite falling unit prices. Global investment in carbon capture and storage (CCS) tripled to $3 billion, and that in hydrogen was $1.5 billion. “Our figures show that the world has reached half a trillion dollars a year in its investment to decarbonize the energy system. Clean power generation and electric transport are seeing heavy inflows, but need to see further increases in spending as costs fall. Technologies such as electric heat, CCS and hydrogen are only attracting a fraction of the investment they will need in the 2020s to help bring emissions under control. We need to be talking about trillions per year if we are to meet climate goals”, commented Albert Cheung, head of analysis at BNEF. Global investment in renewable energy capacity moved up 2 % to $303 billion in 2020. This was the second-highest annual figure ever (after 2017’s $313.3 billion), and the seventh consecutive total of more than $250 billion. A geographical split of BNEF’s energy transition investment data shows that Europe accounted for the biggest slice of global investment, at $166 billion (up 67 %), with China at $135 billion (down 12 %) and the USA at $85 billion (down 11 %). Europe’s impressive performance was driven by a record year for electric vehicle sales, and the best year in renewable energy investment since 2012. https://about.bnef.com / World Invested Unprecedented Amounts in Low-Carbon Assets In battery-electric vehicles, the lithium-ion battery is dominant; however, for full hybrid electric vehicles (those that have electric-only modes but do not plug- in), NiMH batteries are still the most common battery on the road. With the growing market for hybrid electric vehicles (HEVs), will this drive further demand for NiMH batteries and stop them from being eliminated from the automotive market? Toyota is the ruling OEM in the global HEV car market, with over 60 % market share in 2019. Other manufacturers have started to eat into this share over the years, but Toyota still reigns supreme. While the other OEMs have mostly transitioned towards Li-ion batteries for their HEVs, Toyota remains committed to NiMH batteries and HEVs for the foreseeable future, with the majority of their line-up now using either NiMH or Li-ion depending on the specifications. For the relatively small batteries that are used in HEVs, the NiMH is still sufficient to meet requirements. It is also much more technologically mature and lower cost than Li-ion. Sales of HEVs have continued to grow throughout the COVID-19 pandemic despite the downturn of the overall car market. This, combined with Toyota’s dominance and NiMH portfolio, provides a good market for NiMH batteries, at least in the short term. Li-ion technology is still evolving and reducing in price; at a certain point, it may no longer be cost-effective to continue using NiMH. Additionally, fossil fuel bans are incoming, with countries like the UK banning purely internal combustion engine (ICE) vehicles by 2030 and only allowing hybrids “that can drive a significant distance with zero emissions”. HEV manufacturers will likely increase the battery capacity in order to give more electric-only range, making the Li-ion option more appealing. Even with this stay of execution for HEVs, banning vehicles with ICEs of any sort is likely to follow shortly after. This will eliminate the HEV in many markets and hence the demand for NiMH. IDTechEx recently published the report “Full Hybrid Electric Vehicle Markets 2021-2041”. This report gives an in-depth look at the historic HEV market in China, Europe, Japan, South Korea, and the US, with an outlook over the next 20 years. The electric truck market in the US is primed for huge growth. Having largely lagged behind China and Europe in electric commercial vehicle deployment, the transition to zero-emission vehicles in this sector now seems set to begin in earnest. The IDTechEx report, “Electric Truck Markets 2021-2041” contains twenty-year regional forecasts for the battery electric and fuel cell truck markets. US President Biden’s announcement, alongside factors such as the California Air Resources Board’s Advanced Clean Trucks regulation, which last year mandated that 75 % of new Class 4-8 ridged truck and 55 % of new tractor truck sales in California must be zero-emission by 2035 and growing evidence of significant demand for commercial EVs from major US corporations, should give great confidence to truck manufacturers and their supply chain that the market for electric trucks will be worth the resources and investment that is necessary to transition away from the combustion engine. A great deal of attention is given to whether battery electric trucks will be able to offer the range to make long-haul trucking applications viable with an electric powertrain. This question will be addressed to some extent by the first delivery of Tesla Semi trucks, which at least provisionally is still penciled in for 2021 (though production timelines have slipped on multiple occasions). While the mass of batteries required and the likely need for ultra-fast charging undoubtedly make long haul EV trucking a challenge, there is a significant market for medium and heavy-duty trucks that do not require extensive range. Swedish heavy-duty truck and bus manufacturer Scania’s recent forecasts highlight how quickly the market is progressing around the world. By 2025 Hybrid Electric Vehicles: A Stay of Execution for NiMH Batteries