Super Fast Charging vs. Battery Swapping: The Energy Replenishment Battle for Electric Vehicles
As electric vehicles (EVs) become more popular, addressing the anxiety surrounding energy replenishment has become a primary challenge for car manufacturers. BYD has introduced its flash charging technology, while NIO has partnered with CATL to establish a battery swapping network.
BYD’s flash charging technology has increased the charging rate to 10C, allowing for a peak charging speed of up to 1 kilometer in just 1 second. In contrast, NIO and CATL’s battery swapping technology can fully recharge a vehicle in just 3 minutes. However, fast charging technology poses challenges to the existing power grid, and the high construction costs of battery swapping stations present obstacles as well. Both technological approaches have their respective advantages and disadvantages.
In the future, fast charging and battery swapping will likely form the mainstream methods of energy replenishment for new energy vehicles, catering to various user needs in different scenarios.
Both super fast charging and battery swapping essentially aim to enhance the speed of energy replenishment to make the EV experience comparable to that of gasoline vehicles. However, manufacturers need to make a choice between these two technological paths.
As electric vehicles continue to gain traction, addressing energy replenishment anxiety has become a significant challenge for car manufacturers. Two main commercial technology routes to alleviate this anxiety have emerged as hot topics in the market. Recently, BYD announced a new technology called the “Kilovolt Architecture,” allowing its vehicles to achieve a charging power of 1 megawatt (1000 kilowatts), with peak charging speeds reaching 1 kilometer in just 1 second. Observations during a demonstration by Caijing noted that the Han L model, equipped with the Kilovolt Architecture, could charge for a range of 400 kilometers within 5 minutes of connecting to a flash charging station.
On the same day, NIO and CATL announced a strategic cooperation agreement to jointly build a battery swapping network for their entire range of passenger vehicles. The Chinese market for new energy vehicles has entered the mainstream phase, with data released by the Ministry of Public Security indicating that as of January 17, 2024, the total number of new energy vehicles reached 31.4 million. Retail sales of new energy passenger vehicles in 2024 are projected to be 10.899 million, a year-on-year increase of 40.7%, with an annual penetration rate of 47.6%. Addressing energy replenishment anxiety is crucial for maintaining the rapid growth of new energy vehicle penetration.
However, the convenience of energy replenishment facilities still lags behind that of traditional gas stations. During holidays, long queues for fast charging and limited charging slots can deter consumers from choosing fully electric vehicles, as charging can take up to an hour. In first- and second-tier cities, the difficulty lies in finding parking spaces, while in third- and fourth-tier cities, the charging infrastructure is still not fully developed.
In this context, how effective are BYD’s flash charging technology and NIO and CATL’s battery swapping technology? Are there challenges to their widespread adoption?
Fast Charging: Can Charging for 5 Minutes Cover Hundreds of Miles, and Can the Power Grid Handle It?
Fast charging technology has always been a significant challenge for electric vehicle manufacturers. To improve charging efficiency, it’s essential to address the issue of charging rates. Currently, the mainstream understanding in the EV industry refers to “C-rate” charging. The term “C” refers to the current size that allows a battery to fully charge within a specific time frame. For instance, 1C charging means a battery charges fully in one hour, while 2C charging achieves this in 30 minutes, and so forth.
As companies continue to launch high-rate charging systems, a 5C battery is expected to be applied in vehicles by 2024, with a peak charging current of 700 amps and a peak power of 520 kilowatts, enabling a range of 500 kilometers to be charged in just 12 minutes. HarmonyOS has integrated a 6C battery developed by CATL into its flagship product, allowing a 65 kWh battery to charge from 10% to 80% in just 10.5 minutes.
Xpeng Motors and Volkswagen China have signed a memorandum of understanding to collaboratively build the largest super fast charging network in China, sharing their proprietary, industry-leading fast charging networks, which will include over 20,000 charging terminals across 420 cities in China. Tesla, the early pioneer in fast charging technology, currently produces the V4 supercharging station, with a maximum charging power of 350 kilowatts, which can reduce charging times for Tesla vehicles to under 20 minutes. Starting in 2025, Tesla’s V4 charging stations will be widely deployed in the Chinese market.
Compared to the charging rates of over 500 kilowatts offered by domestic manufacturers and battery companies, Tesla’s charging speed appears somewhat slower. However, Tesla’s fast charging is compatible with vehicles operating on both 400-volt and 800-volt platforms, making it more accommodating for existing vehicle owners. The Zeekr brand, based on an 800-volt architecture, has introduced a new model equipped with 800-volt ultra-fast charging technology, supporting a maximum charging power of 500 kilowatts, allowing for an addition of over 500 kilometers of range in just 15 minutes.
Challenges of Achieving Fast Charging
Achieving fast charging technology is not straightforward; it involves overcoming challenges in vehicle design, equipment, and the power grid system. First, breakthroughs in current battery materials are necessary, particularly concerning increased charging rates and heat dissipation. BYD has improved its battery material system to reduce internal resistance and heat generation. In terms of system cooling, BYD has innovated by replacing the traditional liquid cooling method with direct cooling and heating using refrigerant materials to enhance heat exchange efficiency.
From a vehicle design perspective, vehicles must be capable of handling super high voltage and current, necessitating adjustments to the overall vehicle architecture to provide compatible components for flash charging. BYD has developed a universal kilovolt high-voltage architecture to ensure that the battery, motor, power supply, and air conditioning all meet “kilovolt-level” capabilities. Additionally, it has developed a new automotive-grade silicon carbide power chip, which can handle voltage levels of up to 1500 volts.
The introduction of super fast charging technology also poses challenges to the existing power grid’s capacity. A single 1000-kilowatt charging point draws the same amount of power as 50 typical households (20 kilowatts each) simultaneously. If multiple charging points operate simultaneously, local grids may experience short-term overloads. Fast charging users tend to recharge during peak times, which, compounded with industrial power usage peaks, may increase the load on the power grid. To address this, BYD has equipped its flash charging technology with energy storage cabinets, utilizing energy storage batteries to smooth out demand and maintain grid stability.
Given the rising construction costs of fast charging stations, companies must also consider the return on investment in non-first-tier cities.
Battery Swapping: Can it Fully Recharge in 3 Minutes, and Can the Costs Be Sustained?
While companies are tackling the fast charging challenge, many are also exploring battery swapping technology. Major players such as FAW, GAC Group, Changan Automobile, Geely Holding, Chery Automobile, Jianghuai Automobile Group, and Lotus have all announced research into battery swapping technology and have joined the battery swapping alliance formed by NIO.
The world’s largest battery supplier, CATL, launched its battery swapping service brand, EVOGO, in 2022, featuring its core product, the “Chocolate Battery Swapping Block.” Yang Jun, CEO of Times Electric, indicated that CATL plans to establish 1,000 battery swapping stations by 2025, expanding into the markets of Hong Kong and Macau. The mid-term goal is to establish 10,000 stations, with a final target of over 30,000.
The rapid construction and promotion of battery swapping stations are closely linked to their convenience, as a vehicle can be fully recharged in just 3 to 5 minutes, enhancing travel convenience. As such, battery swapping station construction has been included as a crucial topic in policy discussions. In May 2020, battery swapping stations were integrated into the “New Infrastructure” category and were mentioned for the first time in the “Government Work Report.” In October of the same year, the “New Energy Vehicle Industry Development Plan (2021-2035)” was released, encouraging the application of battery swapping models. Pilot projects for battery swapping began the following year, with the Ministry of Industry and Information Technology initiating trials in 11 cities nationwide in October 2021.
In 2023, multiple government departments issued a notification to promote comprehensive electrification of vehicles in public sectors, which included plans to build a balanced, smart, and efficient charging and battery swapping infrastructure system.
According to forecasts from Founder Securities, by 2025, sales of battery-swapped passenger vehicles are expected to exceed 2.8 million units, while sales of commercial vehicles will surpass 500,000 units. By that time, the demand for battery swapping stations is expected to reach approximately 28,000, with the total scale of the industry estimated to exceed 330 billion yuan.
The market and policy environment have attracted more companies to enter the battery swapping landscape. For example, Aodong New Energy has developed a commercial closed-loop that includes core technology research, operational commercialization of battery swapping stations, distributed energy storage, and full lifecycle battery management, planning to operate over 10,000 battery swapping stations nationwide by 2025 to provide services for over 10 million new energy vehicles. Its partners now include major energy companies like Sinopec and BP, along with several automakers and local investment firms.
However, battery swapping is not a high-return business, and the significant investment and long payback periods pose major challenges. In 2021, GCL-Poly Energy entered the battery swapping sector, but by April 2024, it announced plans to terminate its battery swapping business, primarily due to the high investment and lengthy return periods. Thus, finding allies to share costs is a wise approach to tackle the high infrastructure costs.
CATL is advancing a strategic investment of no more than 2.5 billion yuan in NIO Energy to further solidify their strategic partnership. Cui Dongshu, the secretary-general of the Passenger Car Association, noted that the collaboration between CATL and NIO signifies a strategic resonance between the leading power battery supplier and a pioneer in smart electric vehicles in the vehicle-battery separation model.
With support from national and local authorities, we can foresee that the new energy vehicle industry is rapidly entering a “chargeable, swappable, and upgradable” 2.0 era, where battery swapping will complement fast charging as a mainstream method of energy replenishment for new energy vehicles.
Currently, both fast charging and battery swapping have their strengths and weaknesses in terms of usage, business models, and ecological layouts. In terms of user experience, both technological paths strive to alleviate user anxiety regarding energy replenishment, serving as complementary solutions for energy needs in various scenarios.
