1 00:00:01,280 --> 00:00:01,520 Speaker 1: Hi. 2 00:00:01,680 --> 00:00:05,160 Speaker 2: I'm Olivia Rodgaard, a reporter for Bloomberg Green. I'm currently 3 00:00:05,160 --> 00:00:07,400 Speaker 2: working on a piece about climate anxiety, and I have 4 00:00:07,480 --> 00:00:08,800 Speaker 2: request for zero listeners. 5 00:00:09,360 --> 00:00:10,280 Speaker 1: Climate change can. 6 00:00:10,200 --> 00:00:12,840 Speaker 2: Cause stress, both of people directly affected by it and 7 00:00:12,880 --> 00:00:15,440 Speaker 2: for those concerned about its effects on others and their future. 8 00:00:16,200 --> 00:00:18,239 Speaker 2: If you're okay to share your experience of this, we 9 00:00:18,280 --> 00:00:20,919 Speaker 2: would love to hear from you. Tell us what makes 10 00:00:20,960 --> 00:00:23,159 Speaker 2: you worry, how your worries affect your life, and what 11 00:00:23,239 --> 00:00:26,200 Speaker 2: helps you feel better. Take our short survey. There's a 12 00:00:26,239 --> 00:00:27,120 Speaker 2: link in the show notes. 13 00:00:27,280 --> 00:00:34,559 Speaker 1: Thank you. Welcome to Zero. I'm Akshatrati. We now know 14 00:00:34,680 --> 00:00:38,360 Speaker 1: that this will be the hottest year ever recorded, and 15 00:00:38,600 --> 00:00:43,040 Speaker 1: we'll hit another high on greenhouse gas emissions. The bad 16 00:00:43,080 --> 00:00:46,479 Speaker 1: news is coming in thick and fast, which makes it 17 00:00:46,560 --> 00:00:50,440 Speaker 1: easy to lose hope. But that's why it's also important 18 00:00:50,479 --> 00:00:55,120 Speaker 1: to recognize how much progress we have made despite many challenges. 19 00:00:56,160 --> 00:00:59,040 Speaker 1: That's the reason I wrote a book called Climate Capitalism, 20 00:01:00,160 --> 00:01:04,120 Speaker 1: stories of solutions that are already working at scale around 21 00:01:04,160 --> 00:01:07,920 Speaker 1: the world and the challenges many people had to overcome 22 00:01:08,120 --> 00:01:11,480 Speaker 1: to make them a reality. My hope is that people 23 00:01:11,520 --> 00:01:15,039 Speaker 1: will learn from those successes and deploy those solutions in 24 00:01:15,120 --> 00:01:19,200 Speaker 1: other places. For this bonus episode of Zero, I'm going 25 00:01:19,240 --> 00:01:22,440 Speaker 1: to read an extract from the book. It's from chapter three, 26 00:01:22,720 --> 00:01:27,120 Speaker 1: titled The Winner. It's also been published on Bloomberg dot com. 27 00:01:27,800 --> 00:01:31,600 Speaker 1: The story charged the rise of the Chinese battery company CATL. 28 00:01:32,160 --> 00:01:34,640 Speaker 1: It's a company you might never have heard of, but 29 00:01:35,080 --> 00:01:37,760 Speaker 1: over the last decade it has grown to become the 30 00:01:37,800 --> 00:01:41,520 Speaker 1: world's largest battery maker. I hope you enjoy it, and 31 00:01:41,640 --> 00:01:44,280 Speaker 1: if you'd like to read other stories of climate solutions 32 00:01:44,360 --> 00:01:47,720 Speaker 1: in action, you can order my book Climate Capitalism, which 33 00:01:47,760 --> 00:02:00,920 Speaker 1: is out now. Thank you. It was an admit of defeat, 34 00:02:01,520 --> 00:02:03,880 Speaker 1: but you would never know it looking at the mild 35 00:02:03,880 --> 00:02:08,040 Speaker 1: mannered smiles. That morning, Angler Merkel, then Germany's Chancellor, was 36 00:02:08,040 --> 00:02:12,520 Speaker 1: standing next to China's Premier Lee Kirchiang on a partially 37 00:02:12,600 --> 00:02:16,560 Speaker 1: cloudy summer morning in Berlin in July twenty eighteen. Both 38 00:02:16,639 --> 00:02:20,800 Speaker 1: leaders made small talk between posing for the cameras. A 39 00:02:20,840 --> 00:02:23,200 Speaker 1: few feet in front of them, two men in dark 40 00:02:23,240 --> 00:02:26,240 Speaker 1: suits sat at a desk. They had identical leather bound 41 00:02:26,240 --> 00:02:30,800 Speaker 1: folders open and pens in hand. Then, with the blessing 42 00:02:30,840 --> 00:02:34,480 Speaker 1: of the elders standing behind them, Zang Yukun, the CEO 43 00:02:34,680 --> 00:02:39,320 Speaker 1: of contemporary Empers Technology Limited or COTL, the world's largest 44 00:02:39,320 --> 00:02:43,280 Speaker 1: battery company, and Wolfgang Theofanse, a minister for the German 45 00:02:43,320 --> 00:02:47,040 Speaker 1: state of Turunjia, signed an agreement that committed the Chinese 46 00:02:47,040 --> 00:02:53,359 Speaker 1: manufacturing giant to build Germany's first large electric car battery factory. 47 00:02:53,880 --> 00:02:57,600 Speaker 1: The moment passed quickly, and few of those present realized 48 00:02:57,639 --> 00:03:01,920 Speaker 1: the historical importance. Germany is known as the home of 49 00:03:01,960 --> 00:03:05,600 Speaker 1: the car industry, and with good reason. It is where, 50 00:03:05,720 --> 00:03:09,200 Speaker 1: in eighteen seventy nine, Carl Benz built and ran one 51 00:03:09,240 --> 00:03:13,000 Speaker 1: of the first internal combustion engines designed to power a car. 52 00:03:13,880 --> 00:03:16,440 Speaker 1: Today it is home to Volkswagen, one of the world's 53 00:03:16,480 --> 00:03:21,680 Speaker 1: largest car companies, and other brands such as BMW, Audi, Mercedes, 54 00:03:21,680 --> 00:03:26,000 Speaker 1: Benz and Porsche. By one estimate, the car industry accounts 55 00:03:26,040 --> 00:03:29,680 Speaker 1: for a seventh of Germany's jobs, a fifth of its exports, 56 00:03:30,000 --> 00:03:33,679 Speaker 1: and a third of its research spending. The agreement was 57 00:03:33,720 --> 00:03:36,960 Speaker 1: an acknowledgment that the industry, which had been the country's 58 00:03:37,000 --> 00:03:41,760 Speaker 1: economic backbone, had finally failed, not because it couldn't make 59 00:03:41,840 --> 00:03:45,600 Speaker 1: cars that people wanted, but because it hadn't developed a 60 00:03:45,600 --> 00:03:49,640 Speaker 1: crucial technology that would power them. In the twenty first century, 61 00:03:50,280 --> 00:03:55,800 Speaker 1: lithium iron batteries. While countries are finally trying to catch up, 62 00:03:56,120 --> 00:03:59,880 Speaker 1: China has taken a commanding lead. By twenty twenty five, 63 00:04:00,320 --> 00:04:04,000 Speaker 1: China's battery production capacity will be three times as much 64 00:04:04,080 --> 00:04:07,200 Speaker 1: as the rest of the world combined. It wasn't just 65 00:04:07,280 --> 00:04:10,480 Speaker 1: the Germans that missed the boat. Even as recently as 66 00:04:10,520 --> 00:04:14,000 Speaker 1: the early two thousands, few were sure that batteries could 67 00:04:14,040 --> 00:04:18,240 Speaker 1: do so much at such low costs. China's rise as 68 00:04:18,279 --> 00:04:20,920 Speaker 1: the global leader of lithium ion batteries is now a 69 00:04:20,960 --> 00:04:24,640 Speaker 1: matter of regret for the oil industry which invented them, 70 00:04:24,800 --> 00:04:29,320 Speaker 1: for the Americans who nurtured the technology toward commercialization, and 71 00:04:29,400 --> 00:04:31,760 Speaker 1: for the Japanese who were the first to scale up 72 00:04:31,800 --> 00:04:35,599 Speaker 1: the technology. So I traveled to China to find out 73 00:04:35,640 --> 00:04:40,080 Speaker 1: the story of how it happened. The first thing I 74 00:04:40,160 --> 00:04:42,839 Speaker 1: noticed when I walked into the twentieth floor office of 75 00:04:42,920 --> 00:04:47,599 Speaker 1: cotl's vice chairman Huang Schlin was the view. It was 76 00:04:47,640 --> 00:04:51,040 Speaker 1: a gray November afternoon in twenty eighteen, and a thick 77 00:04:51,120 --> 00:04:54,760 Speaker 1: fog rolled over the mountains in front of us, revealing 78 00:04:54,839 --> 00:04:58,599 Speaker 1: a bay that opens into the East China Sea. Huang 79 00:04:58,720 --> 00:05:01,479 Speaker 1: is second in command at s ETL and one of 80 00:05:01,600 --> 00:05:05,039 Speaker 1: China's richest men. Together, we admired the view for a 81 00:05:05,120 --> 00:05:08,080 Speaker 1: little bit, but I was eager to ask him questions. 82 00:05:08,760 --> 00:05:13,640 Speaker 1: He handed me a cup of water and we talked. Batteries. Wow. 83 00:05:14,600 --> 00:05:18,600 Speaker 1: The battery is a two hundred year old invention. Technically, 84 00:05:18,680 --> 00:05:22,560 Speaker 1: it is any device that converts chemical energy to electrical energy. 85 00:05:23,360 --> 00:05:26,479 Speaker 1: While the first one was a rudimentary example invented by 86 00:05:26,640 --> 00:05:31,159 Speaker 1: Italian chemist Alessandro Volta in seventeen ninety nine, it wasn't 87 00:05:31,279 --> 00:05:35,120 Speaker 1: until sixty years later, when lead acid battery chemistry was born, 88 00:05:35,560 --> 00:05:39,000 Speaker 1: that batteries could be put to work beyond single use. 89 00:05:40,120 --> 00:05:42,719 Speaker 1: By the end of the nineteenth century, lead acid batteries 90 00:05:42,720 --> 00:05:47,960 Speaker 1: were deployed on a mass kiale, including briefly to power cars. 91 00:05:49,240 --> 00:05:52,680 Speaker 1: This was short lived. Early batteries couldn't compete with the 92 00:05:52,720 --> 00:05:56,279 Speaker 1: distances that were covered in a car that burned fossil fuels. 93 00:05:57,040 --> 00:05:59,120 Speaker 1: The rebirth of the electric car had to weigh the 94 00:05:59,160 --> 00:06:02,040 Speaker 1: best part of his century with the invention of the 95 00:06:02,080 --> 00:06:06,640 Speaker 1: lithium ion battery. During the oil crises of the nineteen seventies, 96 00:06:06,920 --> 00:06:09,919 Speaker 1: big fossil fuel companies were reminded that oil is a 97 00:06:09,960 --> 00:06:13,200 Speaker 1: finite commodity. That's when they doubled down on efforts to 98 00:06:13,240 --> 00:06:17,320 Speaker 1: find alternative sources of energy. One of those projects was 99 00:06:17,360 --> 00:06:21,599 Speaker 1: spearheaded by chemist Stanley Whittingham at the US oil giant EGXON. 100 00:06:22,120 --> 00:06:24,960 Speaker 1: His work led to the invention of the world's first 101 00:06:25,200 --> 00:06:29,760 Speaker 1: rechargeable lithium ion battery. There was just one major problem 102 00:06:29,800 --> 00:06:36,320 Speaker 1: that needed fixing. The battery kept bursting into flames before 103 00:06:36,360 --> 00:06:39,760 Speaker 1: Whittingham was able to do anything about that. The nineteen 104 00:06:39,839 --> 00:06:43,920 Speaker 1: eighties rolled around, the oil glood returned and Egxon's interest 105 00:06:44,000 --> 00:06:48,800 Speaker 1: in finding alternatives waned. Fortunately, his work sparked broader interest 106 00:06:48,880 --> 00:06:52,520 Speaker 1: in the field. Over the next decade, lithium iine batteries 107 00:06:52,560 --> 00:06:55,800 Speaker 1: were the subject of intense scientific work around the world. 108 00:06:56,520 --> 00:07:02,280 Speaker 1: Three researchers John Goodenough, Rashid Yazami, and Akira Yoshino provided 109 00:07:02,279 --> 00:07:07,040 Speaker 1: the upgrades that transformed Whittingham's invention into a viable commercial product. 110 00:07:07,720 --> 00:07:10,800 Speaker 1: For that, they were awarded the twenty nineteen Nobel Prize 111 00:07:10,840 --> 00:07:15,840 Speaker 1: in Chemistry. Sony became the first company to commercialize the 112 00:07:15,840 --> 00:07:19,320 Speaker 1: lithium man battery in nineteen ninety two. It offered it 113 00:07:19,360 --> 00:07:24,080 Speaker 1: as an optional upgrade for its handicam video recorder. Others 114 00:07:24,080 --> 00:07:27,760 Speaker 1: were quick to jump on Sony's success, including Zang Yukun, 115 00:07:27,840 --> 00:07:30,040 Speaker 1: who in ninety nine, at the age of thirty one, 116 00:07:30,440 --> 00:07:35,440 Speaker 1: founded Amperik's Technology Limited, or ATL. It's also when he 117 00:07:35,520 --> 00:07:39,720 Speaker 1: began working with his co founder Huang Chilin. Within two years, 118 00:07:39,800 --> 00:07:44,000 Speaker 1: ATL had produced lithiumn batteries for one million devices and 119 00:07:44,120 --> 00:07:47,360 Speaker 1: made its name as a reliable supplier. In two thousand 120 00:07:47,400 --> 00:07:51,160 Speaker 1: and five, ATL was acquired by TDK, a Japanese firm 121 00:07:51,320 --> 00:07:54,920 Speaker 1: probably best known for its cassette tapes and recordable CDs. 122 00:07:55,640 --> 00:07:58,760 Speaker 1: Zug and Huang decided to stay on After the acquisition, 123 00:07:59,680 --> 00:08:04,480 Speaker 1: TDA added Japanese discipline to atl's manufacturing process and grew 124 00:08:04,520 --> 00:08:07,480 Speaker 1: its lithium ion battery business to focus on a new 125 00:08:07,640 --> 00:08:12,000 Speaker 1: cash cow, the smartphone market. Soon ATL would go on 126 00:08:12,080 --> 00:08:16,000 Speaker 1: to supply batteries to both Samsung and Apple, the same 127 00:08:16,040 --> 00:08:20,680 Speaker 1: Apple that was just about to launch the iPhone. It's 128 00:08:20,720 --> 00:08:25,200 Speaker 1: also when Huang began getting queries about batteries for electric cars. 129 00:08:25,880 --> 00:08:29,680 Speaker 1: The earliest request came from Reva, an Indian company. At 130 00:08:29,720 --> 00:08:32,760 Speaker 1: the time, Reva was making the Gwiz, a two seater 131 00:08:32,840 --> 00:08:36,360 Speaker 1: electric car powered by lead acid batteries. Its top speed 132 00:08:36,480 --> 00:08:39,080 Speaker 1: was forty kilometers per hour. It had a range of 133 00:08:39,120 --> 00:08:43,120 Speaker 1: about eighty kilometers, and of course, it charged very slowly. 134 00:08:43,760 --> 00:08:46,600 Speaker 1: The company hoped that lithium and batteries would increase the 135 00:08:46,600 --> 00:08:51,400 Speaker 1: car speed and range, and also enable faster charging, but 136 00:08:51,520 --> 00:08:54,360 Speaker 1: Huang and Zong did not know how to make an 137 00:08:54,440 --> 00:08:58,120 Speaker 1: electric car battery, so to develop a solution they created 138 00:08:58,120 --> 00:09:03,040 Speaker 1: a research department within eighty They also acquired technology licenses 139 00:09:03,160 --> 00:09:05,840 Speaker 1: from the US that would enable them to build up 140 00:09:05,960 --> 00:09:10,320 Speaker 1: existing work. Chinese companies have been accused of stealing or 141 00:09:10,360 --> 00:09:14,720 Speaker 1: copying from foreign firms, but with its own robust research efforts, 142 00:09:15,040 --> 00:09:18,440 Speaker 1: ATL broke that mold and set the stage for Chinese 143 00:09:18,520 --> 00:09:21,800 Speaker 1: domination of what will be one of the most important 144 00:09:21,840 --> 00:09:28,600 Speaker 1: sectors of manufacturing in the twenty first century. By two 145 00:09:28,679 --> 00:09:31,640 Speaker 1: thousand and eight, ATL already had something to show for 146 00:09:31,679 --> 00:09:35,160 Speaker 1: its efforts. That year, the Chinese government rolled out a 147 00:09:35,200 --> 00:09:38,719 Speaker 1: demo fleet of electric buses at the Beijing Olympics, some 148 00:09:38,800 --> 00:09:42,120 Speaker 1: of which were powered by ATL batteries. It was also 149 00:09:42,160 --> 00:09:44,719 Speaker 1: the time when the Chinese government was under pressure from 150 00:09:44,760 --> 00:09:48,040 Speaker 1: citizens and from global media to do something about its 151 00:09:48,080 --> 00:09:52,600 Speaker 1: smoggy skies and lower its carbon footprint. The demo fleet 152 00:09:52,760 --> 00:09:55,679 Speaker 1: was the start of the government's plan to electrified transport, 153 00:09:55,960 --> 00:09:59,480 Speaker 1: a move that would cut deadly air pollution, reduce oil imports, 154 00:09:59,720 --> 00:10:04,559 Speaker 1: and lower greenhouse gas emissions. Huang and Zang sensed an opportunity. 155 00:10:05,080 --> 00:10:09,840 Speaker 1: In twenty eleven, they created the spinout company catl C, 156 00:10:10,280 --> 00:10:13,600 Speaker 1: standing for Contemporary to denote their belief that the future 157 00:10:13,600 --> 00:10:17,760 Speaker 1: of batteries lay in the car business. About the same time, 158 00:10:17,880 --> 00:10:20,760 Speaker 1: in a bid to capitalize on our next generation technology, 159 00:10:20,960 --> 00:10:25,240 Speaker 1: the Chinese government introduced subsidies for electric cars. The catch 160 00:10:25,400 --> 00:10:28,280 Speaker 1: was that to be eligible for those subsidies, the battery 161 00:10:28,360 --> 00:10:32,320 Speaker 1: had to be Chinese made. That's when BMW, which was 162 00:10:32,360 --> 00:10:35,360 Speaker 1: looking to grow its presence in China, partnered with the 163 00:10:35,480 --> 00:10:40,680 Speaker 1: Chinese car maker Brilliance. In twenty thirteen, BMW Brilliants launched 164 00:10:40,720 --> 00:10:44,280 Speaker 1: the all electric Zenoro for the Chinese market. It was 165 00:10:44,320 --> 00:10:47,439 Speaker 1: based on the design of BMW's X one and used 166 00:10:47,559 --> 00:10:52,760 Speaker 1: COTL batteries. UNLIKEAA batteries, which are essentially the same no 167 00:10:52,880 --> 00:10:56,439 Speaker 1: matter who makes them, electric car batteries typically need to 168 00:10:56,520 --> 00:10:59,640 Speaker 1: be custom made for different car models so that they 169 00:10:59,720 --> 00:11:01,640 Speaker 1: can fit in the body of the car in the 170 00:11:01,720 --> 00:11:05,520 Speaker 1: most optimal way. Engineers from the car maker need to 171 00:11:05,559 --> 00:11:09,880 Speaker 1: work with those from the battery company, exchanging ideas, standards 172 00:11:09,880 --> 00:11:14,720 Speaker 1: and processes. While working with BMW on Zenoro, CTL picked 173 00:11:14,800 --> 00:11:18,560 Speaker 1: up some German engineering skills, improving their attention to detail 174 00:11:18,760 --> 00:11:22,679 Speaker 1: and increasing the reliability of products coming off their factory floor. 175 00:11:23,280 --> 00:11:27,319 Speaker 1: At an event in twenty seventeen celebrating the Zenoro Zeng said, 176 00:11:27,800 --> 00:11:30,520 Speaker 1: we have learned a lot from BMW and now we 177 00:11:30,559 --> 00:11:34,360 Speaker 1: have become one of the top battery manufacturers globally. Two 178 00:11:34,480 --> 00:11:39,120 Speaker 1: years later, the circle was completed. That's when Coatl broke 179 00:11:39,200 --> 00:11:43,000 Speaker 1: ground on Germany's first car battery factory, beating the revered 180 00:11:43,040 --> 00:11:47,080 Speaker 1: German car industry to the punch. Today, the Chinese giant 181 00:11:47,120 --> 00:11:49,840 Speaker 1: also has a plant in Hungary, with plans to build 182 00:11:50,000 --> 00:11:54,000 Speaker 1: new ones in the US and Mexico. It supplies batteries 183 00:11:54,040 --> 00:11:59,320 Speaker 1: to every major electric vehicle manufacturer, including Tesla. Its story 184 00:11:59,360 --> 00:12:02,079 Speaker 1: shows how China left the world far behind in the 185 00:12:02,120 --> 00:12:06,160 Speaker 1: battery race and how others are still struggling to catch up. 186 00:12:11,000 --> 00:12:13,280 Speaker 1: Thanks for listening to Zero. You can find the full 187 00:12:13,320 --> 00:12:15,960 Speaker 1: story of how CTL grew into the giant it is 188 00:12:16,000 --> 00:12:19,520 Speaker 1: today in my book Climate Capitalism. There's a link in 189 00:12:19,559 --> 00:12:23,720 Speaker 1: the show notes. Zero's producer is Oscar Boyd and Senior 190 00:12:23,760 --> 00:12:27,800 Speaker 1: Producer is Christine Driskell. I'm Akshatrati and we'll be back 191 00:12:27,840 --> 00:12:30,360 Speaker 1: with a full episode of Zero later this week.