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Photo of cheap batteries designed for EVs from China
asiatimes.com

The Chinese Battery That Could Zap Alberta Oil

When it comes to energy transition, Chinese innovation is changing the game, and we better get ready for it

If we move beyond the fuss over carbon taxes for a second, something big is happening in the world of energy production, and it’s coming from China.

The Chinese firm Contemporary Amperex Technology Co. Limited (CATL) has created some truly groundbreaking batteries, and there are more than a few reasons why we should care.

Their lithium-iron-phosphate batteries are a game changer for many reasons: 

  1. Their new batteries last longer, are more stable, and charge faster;
  2. They don’t require expensive cobalt and nickel, which often come from sketchy Central African mines by women and children working in slave-like, dangerous conditions; and 
  3. They cost only half what other batteries on the market cost.

When the price was announced, it was so obscenely low that Western carmakers thought it was a joke marketing ploy. 

But it turns out it’s for real.

And because it’s real, as an oil and gas producer, we need to consider the effects these game-changing batteries will have on our energy industry.

CATL is leading the world in innovative and affordable battery production | Robert Way | Shutterstock
CATL is leading the world in innovative and affordable battery production | Robert Way | Shutterstock

Cars That’ll Blow Your Mind

Anyone investing in the fossil fuel industry will have much to worry about, automotive expert Kevin Williams told  The National Observer after a recent visit to the Shanghai Auto Show and Geely Group’s headquarters (a major Chinese EV maker). 

“Models are more compelling than what European, other Asian, and American brands have come up with. I’ve seen it with my own two eyes. We’re cooked.”

His assessment helps explain the Biden administration’s recent announcement of a new 100 percent tariff on Chinese EV imports.

The tariff is intended to give American manufacturers time to adapt and create batteries and vehicles that can compete better!

As economics writer Noah Smith noted, the alternative is that we cling to what we’ve known, gas vehicles, while the rest of the world transitions to newer technologies.

The $10,000 EV with a 700km range, the BYD Seagull, on display at the Bangkok International Motor Show in Nonthaburi, Thailand, on March 27
The $10,000 EV with a 700km range, the BYD Seagull, on display at the Bangkok International Motor Show in Nonthaburi, Thailand, on March 27 | Lillian Suwanrumpha | AFP via Getty Images

Can We Keep Up?

And when we say the rest of the world, we really do mean the rest of the world.

The tariffs the US imposed aren’t doing much because, right now, China doesn’t care about selling to North America.

China is targeting developing countries with their very affordable tech; areas once considered the last frontier for fossil fuel expansion.

As David Goldman, the business editor of the Asia Times, noted in a recent piece, “China is exporting less, not more, to the developed markets with which it competes directly, and exporting a great deal more to the Global South, which has virtually unlimited demand for $10,000 electric vehicles, cheap solar panels and broadband infrastructure.”

Revolutionizing the global market with $10,000 EVs will effectively obliterate the demand for oil, the bread and butter of Alberta oil and gas companies.

As China surges forward, reshaping the world’s energy landscape, Canadian policymakers must confront the reality of very soon dwindling oil demand, particularly the implications this will have on Alberta’s’s economy.

Alberta Needs To Adjust, Or Get Left In The Dust

We have always been a leader in the energy industry, and Alberta has  the potential to continue that as the world moves towards more sustainable modes of production.

China now leads the world in energy innovation, and we will face mounting pressure to adapt or risk obsolescence.

Our policymakers must confront future dwindling oil demand and its implications for our economy.

Clinging to outdated narratives isn’t going to cut it. 

Proactive measures to support innovation and diversification within the energy sector are needed. 

Either that or Alberta oil will get zapped much quicker than we think.

And we will all suffer the consequences.

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