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CHINA’S ELECTRIC VEHICLE FOOTPRINT: New data distill the degree to which the world’s leading greenhouse gas emitter is dwarfing its top geopolitical competitors in the rollout of electric vehicles.
China was home to 3.3 million EV sales last year, accounting for half of new sales globally and more than Europe’s and the United States’ total sales combined, according to a new report out today from the International Energy Agency.
China’s combined battery electric and plug-in hybrid electric vehicle stocks also accounted for more than half of all 16.5 million electric vehicles on the world’s roads in 2021.
China’s advantages: For one thing, Chinese EVs are comparatively cheaper than elsewhere, as its large production capacity allows manufacturers to source critical minerals and batteries more cheaply, IEA noted.
A conventional vehicle was only 10% cheaper than an electric vehicle in China last year on a sales-weighted median price basis.
The difference was much larger in other “major markets,” where conventional vehicles were between 45-50% cheaper.
More than half of all electric cars produced globally last year were assembled in China, which “is poised to maintain its manufacturing dominance,” IEA said.
The contrast: Western governments, including the United States, have treated China with a special scrutiny for its top-emitting status, its heavy reliance on coal, and its comparatively less aggressive emissions reduction targets.
President Joe Biden criticized China for not having a larger presence at the COP26 climate change conference in Glasgow last November, and his diplomatic force has pushed the Chinese to do more emissions-cutting.
Still, at the same time that China puts up big numbers in new coal capacity — its 25.2 gigawatts of new coal plants were some 56% of the newly commissioned coal capacity worldwide last year — it’s dominating EV production and deployment, as well as new renewable energy capacity installations.
China accounted for more than 80% of the increase in added renewable capacity installations from 2019 to 2020, per IEA.
Back home: Biden wants to see half of all new vehicle sales be electric by 2030, and he’s been trying to enable more growth for EV manufacturing domestically, something some lawmakers have said must happen to avoid continually propping up China’s industry.
Sales are growing, but getting to Biden’s target is going to be a slog at current rates.
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FERC CHAIRMAN GLICK UP FOR SECOND TERM: Biden nominated Richard Glick for another term as member and chairman of the Federal Energy Regulatory Commission, the White House announced on Friday.
Glick, whose term ends June 30, is one of the commission’s three Democrats and has served as chairman since Jan. 21, 2021.
Glick’s renomination comes at a critical time for the commission, which is under pressure from some lawmakers to more swiftly approve pipelines and other infrastructure to enable more natural gas exports to energy-strained Europe.
His confirmation may hit some roadblocks in the narrowly divided Senate. Glick oversaw FERC’s introduction of controversial new policy statements in February providing that the commission would expand the scope of considerations when assessing pipeline projects, including a prospective project’s greenhouse gas emissions.
Senate Energy and Natural Resources Committee Chairman Joe Manchin joined many Republican lawmakers thereafter in criticizing the policy statements. Industry groups slammed the policy statements, too, arguing in part that they would create uncertainty for project developers.
FERC pulled the policy statements back in about a month after introducing them to provide for more public input, something Glick said was done “in light of concerns that the policy statements created further confusion.”
DIESEL PRICE SURGE HITTING NEW ENGLAND WORST: Retail diesel prices in the Northeast have risen 78% since January, the highest rate of any region in the country, according to the Energy Information Administration.
New England’s average retail diesel price was $6.43 per gallon on May 16. The Central Atlantic region’s average price was just behind at $6.36 per gallon.
EIA noted that a shortage of refining capacity in the regions is setting them back more than some others.
The refining factor: Commodity analysts have been quick to point out, often as a rebuttal to price gouging theories, the degree to which a shortage of refining capacity is driving retail prices up.
In 2021, total U.S. refining capacity fell by nearly 560,000 barrels per day compared to the year before, according to EIA. Total capacity hit a record 18.8 million bpd in 2019.
REGULAR GAS PRICES RISING FAST: Gas prices in the U.S. surged by nearly 50 cents over the last month, to a national average of $4.596 per gallon, according to AAA—a 48-cent spike from last month, when the average sat at $4.120 per gallon, and a whopping $1.55 surge from the same point last year.
The record-high gas prices come just days before the start of summer driving season in the U.S., which traditionally begins Memorial Day weekend and is expected to drive up demand even higher.
ENERGY CRISIS PORTENDS ANOTHER SHOCK FOR ELECTRICITY COSTS: Russia’s war in Ukraine has also touched off another looming energy price crisis— for electricity bills, where monthly averages suggest prices are likely to increase “substantially” in Europe and the U.S.
In Europe, regional forward electricity contracts for late 2022 and 2023 have surged to near-record highs in the last few weeks, “heralding further utility bill hikes,” Bloomberg columnist Javier Blas wrote. “European utilities buy electricity months ahead in the wholesale market to fix costs for their customers, he writes—which effectively bakes-in “significant retail increases for the year ahead.”
Meanwhile, the U.S. Energy Information Administration’s latest short-term energy outlook also forecasted a 3.9% increase in residential electricity consumption prices this summer compared to the same period last year. In its forecast, EIA cited recent trends in demand, as well as the “substantial” increase in natural gas prices and decrease in generation from goal as coal-fired power plants were retired.
POLAND ENDS RUSSIAN GAS CONTRACT AMID RUBLE DISPUTE: Poland has terminated its agreement to receive Russian gas supplies via the Yamal gas pipeline, Polish Climate Minister Anna Moskwa said today, a decision that comes after Poland refused to meet Russia’s demand to pay for its gas supplies in rubles last month, prompting the Kremlin to cut off its gas supply.
Poland said previously it did not plan to extend its contract with Russian gas giant Gazprom, which Reuters notes had originally been slated to expire at the end of 2022. Officials said the decision would not affect gas flows between Russia and Germany, which are also delivered via the Polish-owned Yamal pipeline.
“Russia's aggression against Ukraine has confirmed the accuracy of the Polish government's determination to become completely independent from Russian gas. We always knew that Gazprom was not a reliable partner," Moskwa said on Twitter.
BMW LOOKS TO END RELIANCE ON RUSSIAN GAS: BMW is exploring new investments in solar, geothermal and hydrogen energy to protect itself from the possibility of Russia cutting off its natural gas supply, Reuters reports.
BMW production chief Milan Nedeljkovic said the company, which in 2021 relied on natural gas for 54% of its total energy consumption, has been working to determine how to pivot to these alternative sources of energy, and is working with local authorities to begin transporting hydrogen in. In particular, he said, hydrogen is “very well-suited to lower or even fully compensate” for gas demand.
Bigger picture: The transportation industry, Nedeljkovic said, “accounts for around 37% of German natural gas consumption” and “would come to a standstill" if the gas supply was cut off.
Politico Europe Electric cars spell trouble for Central Europe
Reuters For EV maker Rivian, delivery headache hits as market shuts down coffers
MONDAY | MAY 23
4:00 p.m. Evergreen Action will host Sen. Tina Smith and Rep. Ro Khanna for a “Policy + Pints'' discussion about passing the $555 billion in energy and climate change-related provisions from the Democrats' stalled reconciliation proposal.
TUESDAY | MAY 24
12 p.m. The House Select Climate Crisis Committee will hold a hearing that examines ways to create an affordable and resilient food supply chain in the face of climate change. The panel will hear testimony from nonprofit groups including ReFED, the North American Renderers Association, the National Audubon Society, and more.