Electric sanitation vehicle
Electric sanitation vehicle
Business Model Description
The company produces customized electric sanitation equipment and vehicle based on customer needs, such as the cleaness of the area, and width of the roads where they will perform the task.
Expected Impact
CO2 emissions and environmental pollution from the transportation sector will be reduced because of the use of electric sanitation vehicle.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- China: Hainan
- China: Yunnan
- China: Hebei
- China: Jiangxi
Sector Classification
Infrastructure
Significant differences in terms of quality of the infrastructure exist between urban and rural areas in china. In rural areas, power grids are costly yet of poor quality, and water quality needs to be further improved. (1) China’s circular economy development faces great challenges including lack of standardization, difficulties in recycling low-value material etc. (2)
The 14th 5-Year Plan highlighted the importance of building a modern network of infrastructure that is smart, eco-friendly, safe, and reliable. (3)The State Council issued Action Plan for Cabon Peaking, in which promoting circular economy was listed among the ten major actions. (4)The ""No. 1 Central Document"" for 2021 also highlighted the need to imporve rural infrastructure. (5)
The IOAs in the infrastructure sector center around low-carbon waste treatment, as well as building safer and smarter supply systems of water and electricity.
Investment opportunities introduction
The IOAs in the infrastructure sector center around low-carbon waste treatment, and supply systems of water, electricity and gas that are safer and smarter.
Infrastructure construction requires large amounts of investment, most of which is government-led or requires subsidies. In some fields, such as waste management, policies and regulations are to be improved; in the field of water and energy consumption, pricing mechanism is also in need of improvement.
Waste Management
Many cities and villages in China are encircled by waste. Serious problems exist in domestic waste classification and treatment facilities in urban areas, including insufficient treatment capacity, unbalanced regional distribution, and high landfill pollution risk. The carbon neutrality goals require waste management to be carried out in a low-carbon manner. (6)
According to the ""Guiding Opinions of the State Council, we should speed up the construction of household waste treatment facilities in urban areas, promote household waste incineration power generation, and the reduce urban refuse landfills. It also stressed that we need to be more competent in treatment of hazardous waste and the utilization of food waste.
Regional differences in waste management are pronounced. People in the central and western regions are more prone to pollution risks from insufficient waste disposal. When it comes to harmless treatment, the rate of which in western and northeastern regions is lower than 30%. In terms of waste incineration treatment, they are less well-developed than the eastern regions as well. (6)
The IOAs in this sector center around resourceful utilization and harmless treatment of waste.
Policies and regulations on waste management are to be improved.
Waste Management
Pipeline Opportunity
Electric sanitation vehicle
The company produces customized electric sanitation equipment and vehicle based on customer needs, such as the cleaness of the area, and width of the roads where they will perform the task.
Business Case
Market Size and Environment
USD 100 million - USD 1 billion
The market size of electric sanitation vehicles expanded to 6.51 billion yuan in 2020, about one-fifth of the size of traditional sanitation vehicles. The market size of electric vehicles is expected to exceed 40 billion yuan in 2025, gradually approaching the market size of traditional sanitation vehicles. (23)
Indicative Return
> 25%
According to the 2020 annual reports, the gross margin of electric sanitation vehicle business of Infore Environment Technology Group Co., Ltd., Fulongma Group Co., Ltd., and Yutong Heavy Industries Co., Ltd. in 2020 were 38.67%, 29.01%, and 31.92% respectively. (13) (9) (10)
Investment Timeframe
Short Term (0–5 years)
The payback period of electric sanitation vehicle investment is about 4.85 years. (11)
Ticket Size
> USD 10 million
Market Risks & Scale Obstacles
Market - High Level of Competition
Impact Case
Sustainable Development Need
As China ranks 1st in CO2 emissions, it's under great pressure of emission reduction given the carbon neutrality goals. The transportation sector accounts for about 10% of total carbon emissions, ranking 3rd. Adopting electric vehicles for public sanitation can set an excellent example. (14)
Gender & Marginalisation
The development of sanitation services varies in each region. Similarly, differences also exist in the utilization rate of electric sanitation equipment, with the rate higher in developed eastern areas than in the west.
Expected Development Outcome
As electricanitation equipment gets popular, CO2 emissions from the transportation sector will be reduced, helping the country realize the carbon peaking and carbon neutrality goals.
Gender & Marginalisation
With the development of electric sanitation equipment, economically underdeveloped regions in China can also have access to electric sanitation equipment and vehicle.
Primary SDGs addressed
13.2.2 Total greenhouse gas emissions per year
China's greenhouse gas emissions is around 15 billion tons of CO2 equivalent in 2020. (16)
China strives to achieve carbon peaking before 2030 and carbon neutrality before 2060.
Secondary SDGs addressed
Directly impacted stakeholders
People
Planet
Indirectly impacted stakeholders
People
Outcome Risks
Replacing old equipment with electric sanitation vehicle may leads to resource waste, which would increase the waste disposal pressure and environmental pollution risks.
Impact Risks
If discarded batteries of the electric sanitation vehicle are not recycled properly or promptly, heavy metals stayed in the soil may do harm to people's health and the environment. (11)
Impact Classification
What
As electric sanitation vehicle gets popular, CO2 emissions from the transportation sector will be reduced, helping the country realize the carbon peaking and carbon neutrality goals.
Who
Exhaust gas pollution can be reduced, and people's living environment can be improved. Urban sustainability can also be enhanced.
Risk
Risk: Sanitation companies face transformation risks.
Impact Thesis
CO2 emissions and environmental pollution from the transportation sector will be reduced because of the use of electric sanitation vehicle.
Enabling Environment
Policy Environment
In 2020,an action plan of NDRC stated that 2021-2023, the cumulative promotion volume of electric sanitation vehicle in the public sector nationwide should strive to reach 1 million. By 2023, the proportion of urban public transport electrification should strive to reach 70%. (20)
In 2020, the State Council stated that starting from 2021, the shared of electric sanitation vehicle in newly procured public sectors in the national pilot zones for ecological conservation and key regions of air pollution prevention and control should not be less than 80%. (21)
In 2020, it was stated that we should develop the supporting capacity of smart and electric vehicle industry infrastructure, conduct pilots of EVs in urban public transportation systems, and increase the proportion of electric vehicles in urban public transport. (15)
Financial Environment
In 2022, NDRC published a Notice, which stated that financial system needs to further support the real economy, strengthen the evaluation constraints on bank support to manufacturing industry, and promote medium and long-term loans to the manufacturing sector. (19)
In April 2020, 3 ministries published a notice, which stated that by the end of 2020, for those electric vehicles in the sanitation sector, the subsidy standards should not be reduced in 2020, but be reduced by 10% and 20% respectively in 2021-2022 from a year earlier. (17)
Regulatory Environment
In 2022, 5 ministries jointly issued the ""Guiding Opinions on Further Strengthen the Safety System Development of Electric Vehicle Enterprises"" to further strengthen the safety management of electric vehicles and promote the standardized development of the industry. (18)
In 2021, the Ministry of Housing and Urban-Rural Development published the ""Technical standard for rural solid waste collection transportation and treatment"", specifying standards for the classification, collection, transportation, and treatment of rural household waste. (22)
Marketplace Participants
Private Sector
Yutong Heavy Industries Co., Ltd., Fujian Longma Environmental Sanitation Equipment Co., Ltd., and Changsha Zoomlion Environmental Industry Co., Ltd.
Target Locations
China: Hainan
China: Yunnan
China: Hebei
China: Jiangxi
References
- (1) National Development and Reform Commission, Ministry of Finance, Ministry of Housing and Urban-Rural Development, State Administration for Market Regulation, and National Energy Administration, 2020, Opinions on the High-Quality Development of Urban Water, Electricity, Gas and Heating Industry By Reviewing and Standardizing Charges, http://www.gov.cn/zhengce/content/2021-01/06/content_5577440.htm
- (2) National Development and Reform Commission, 2021, Fourteenth Five-Year Plan for the Development of Circular Economy, http://www.gov.cn/zhengce/zhengceku/2021-07/07/5623077/files/34f0a690e98643119774252f4f671720.pdf
- (3) Xinhua News Agency, The Outline for the 14th Five-Year Plan for Economic and Social Development and Long-Range Objectives through the Year 2035, http://www.gov.cn/xinwen/2021-03/13/content_5592681.htm
- (4) State Council, 2021, Action Plan for Carbon Dioxide Peaking Before 2030, http://www.gov.cn/zhengce/content/2021-10/26/content_5644984.htm
- (5) State Council, 2021, Opinions on Comprehensively Promoting Rural Revitalization and Accelerating the Modernization of Agriculture and Rural Areas, http://www.lswz.gov.cn/html/xinwen/2021-02/21/content_264527.shtml
- (6) National Development and Reform Commission, Ministry of Housing and Urban-Rural Development, 2021 14th Five-Year Plan for the Development of Urban Household Waste Classification and Treatment Facilities, https://www.ndrc.gov.cn/xwdt/tzgg/202105/P020210513624071907544.pdf
- (7) State Council, 2021, Guiding Opinions of the State Council on Accelerating the Establishment of a Sound Economic System with Green, Low-carbon and Circular Development, http://www.gov.cn/zhengce/content/2021-02/22/content_5588274.htm
- (8) https://www.gov.cn,2019, Rural Infrastructure Construction Upgrading is in Urgent Need, http://www.gov.cn/zhengce/2019-10/14/content_5439186.htm
- (9) Fulongma Group Co., Ltd., 2021, 2020 Annual Report, http://static.cninfo.com.cn/finalpage/2021-04-08/1209648048.PDF
- (10) Yutong Heavy Industries Co., Ltd., 2021, 2020 Annual Report, http://static.cninfo.com.cn/finalpage/2021-04-02/1209625602.PDF
- (11) China Institute with Professional Industry Research，2021，2021-2022 Environmental Protection Equipment Industry Development Analysis and Direction Forecast，https://baijiahao.baidu.com/s?id=1714013163784137871&wfr=spider&for=pc
- (12) Release of Yutong New Energy Sanitation Integrated Solution 2020, https://www.sohu.com/na/432130132_120072758
- (13) Infore Environment Technology Group Co., Ltd., 2021, 2020 Annual Report, http://static.cninfo.com.cn/finalpage/2021-04-23/1209772822.PDF
- (14) Huaon.com, 2020, 2020-2025 Potential Analysis and Investment Opportunity Report on New Energy Sanitation Vehicle Industry in China, https://www.huaon.com/channel/trend/640362.html
- (15) National Development and Reform Commission, 2020, Guiding Opinions on Expanding Investment in Strategic Emerging Industries and Cultivating and Strengthening New Growth Points and Growth Poles, https://www.ndrc.gov.cn/xxgk/zcfb/tz/202009/t20200925_1239582.html?code=&state=123
- (16) UNEP, 2022,Emissions Gap Report 2022 https://www.unep.org/resources/emissions-gap-report-2022
- (17) Ministry of Finance, Ministry of Industry and Information Technology, Ministry of Science and Technology, and National Development and Reform Commission, 2020, Notice on Improving the Policies on Government Subsidies for Promotion and Application of New Energy Vehicles, http://www.gov.cn/zhengce/zhengceku/2020-04/23/content_5505502.htm
- (18) Ministry of Industry and Information Technology, 2022, Guiding Opinions on Further Strengthen the Safety System Development of New Energy Vehicle Enterprises, http://www.gov.cn/zhengce/zhengceku/2022-04/09/content_5684250.htm
- (19) National Development and Reform Commission, 2022, Notice on Issuing Several Policies for Promoting the Steady Growth of Industrial Economy, https://www.ndrc.gov.cn/xwdt/tzgg/202202/t20220218_1315823.html?code=&state=123
- (20) National Development and Reform Commission, 2021, Action Plan for Electrification of Vehicles in the Public Sector (2021-2023), http://fzggw.ah.gov.cn/public/7011/145294651.html
- (21) State Council, 2020, Notice on Issuing the Development plan for the New Energy Vehicle Industry (2021-2035), http://www.gov.cn/zhengce/content/2020-11/02/content_5556716.htm
- (22) Ministry of Housing and Urban-Rural Development, 2021, Technical standard for rural solid waste collection transportation and treatment, http://www.gov.cn/zhengce/zhengceku/2021-05/21/content_5640033.htm 23）Insight and Info，2022，Analysis of the driving factors of China's electric sanitation vehicle industry，http://www.360doc.com/content/22/06