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Chinese 5G rollout lifts lithium battery demand

The rollout of fifth-generation (5G) telecom networks is not only driving demand for electronic metals in network equipment, but increasing demand for lithium batteries to provide back-up power for base stations.

Lithium-iron phosphate (LFP) batteries are increasingly replacing lead-acid batteries in telecom networks as they provide higher energy density. And with the signal ranges in 5G networks running shorter than those in 4G networks, the rollout will require more base stations to provide coverage, particularly in cities, in turn requiring more back-up power.

Consequently, power consumption from the telecom industry is set to climb with the installation of 5G base stations. Typical power demand from 4G base stations is 780-930MW, while 5G base stations consume 3.4-3.7GW, according to investment bank Guotai Junan Securities. The bank expects demand for lithium batteries from the 5G sector to jump to 13.3GWh this year from 2.7GWh last year, rising further to 14.5GWh in 2021 and to 16GWh in 2022.

State-owned telecom service provider China Mobile and telecom infrastructure firm China Tower have recently issued tenders for 2GWh of LFP batteries for their 5G networks. China Tower has switched from using lead-acid batteries to procuring recycled LFP batteries from electric vehicles.

China Tower added a net 69,000 new network sites last year, bringing its total to 1.994mn, it said today, and expects it tower business to continue growing with the expansion of 5G. The company is expanding its energy business in tandem, with a portfolio of power back-up and generation, charging and battery exchange in line with growing demand for 5G base station co-location.

The Chinese government is set to release investment funds to accelerate the construction of new infrastructure, including 5G networks and data centres, according to the government's National Development and Reform Commission (NDRC). The installation of network equipment such as base stations and data servers is expected to raise demand for minor metals, including gallium, indium and silicon.

The NDRC approved 15.3bn yuan of investment in 19 projects in the first two months of this year, primarily in the transportation and technology industries.

The Chinese government has put forward plans to stimulate the economy by investing in seven areas — 5G networks, the industrial Internet of Things (IoT), transportation systems, data centres, artificial intelligence, ultra-high-voltage networks and electric vehicle charging stations. The NDRC is moving ahead with investments and working with provincial and municipal governments to reform the project management process for foreign investment.

China is expected to account for 70pc of global 5G connections in 2020, according to telecom industry body the GSM Association. Chinese telecom operators are expected to invest more than $180bn in 2020-25 in mobile capital expenditure, about 90pc of which will be on 5G networks.

By Nicole Willing

News No: 8780
Date: 2020/03/19 - 19:28
News Source: Argus Media

Chinese  lithium  battery  economy  GSM 

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