China Playing by New Set of EV Rules

China has tightened the reins on automakers to accelerate electric car adoption by raising its production quotas, which will go into effect in 2019.

The latest rules call for automakers to obtain a new-energy vehicle score (NEV), expressed as a percentage of the production output of various low-emission vehicles relative to its total output. According to China’s Ministry of Industry and Information Technology, “these vehicles would be classified as all-electric battery vehicles or plug-in hybrids.”

Starting in 2019, these zero or low-emission vehicles will have to comprise a minimum 10 percent of automaker output with a two percent increase to 12 percent in 2020. After that, annual targets will be specified by the Ministry of Industry and Information Technology, according to USA Today.

“This is the single most important piece of EV legislation globally,” said Colin McKerracher, an analyst at Bloomberg New Energy Finance. “Overall, it provides further support for the EV industry in China. EV sales will continue growing quickly, despite the phase-down in direct subsidies.”

This policy would apply only to automakers who manufacture or import more than 30,000 vehicles a year. Automakers also have the option of purchasing credits if they are unable to meet the quota.

The new mandate represents one of the most aggressive efforts to date in increasing low emission vehicle adoption in China. Originally, the government proposed an eight percent quota for 2018; a proposal met with a June 18 industry letter to the Ministry of Industry and Information Technology calling on Beijing to lighten the requirements. This letter also called for parity between Chinese and foreign automakers, particularly with the award of subsidies foreign automakers have not been eligible for, according to Reuters.

USA Today

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