On August 28, 1992, which was supposed to be a normal Friday, many residents of Beijing watched the sky get dark and their houses darkened, only to find that the lights were not on, the TV could not be watched, and the electric fans could not turn on.

It took a long time to know afterwards that Beijing suffered a large-scale power outage on this day, with five emergency power cuts in the Beijing-Tianjin-Tangshan power grid, and power cuts on more than 700 sub-circuits of 765 roads in Beijing, involving more than 30 areas of the city.

The good media gave the day the nickname "Black Friday" and became a topic for citizens to talk about for a long time. In fact, blackouts were common in those days. Beijing did not completely say goodbye to power cuts until the completion of the "9511 Project" of the North China Power Grid in 1995.

Thirty years later, in August 2022, blackouts still occur from time to time. So people who are used to "meter freedom" begin to have some question marks about the energy structure.

For example, why doesn't the loudest new energy make a contribution at a critical moment? Why not increase the construction of traditional coal-fired power plants? Some voices even think of events such as the resumption of coal power in Germany and the half of the planned photovoltaic capacity in the United States in the first half of the year, thinking that the carbon neutralization plan in Europe and the United States is pretending to attack in order to retreat, to go backwards, and to feel that China's new energy construction should also be slow.

These concerns are a little overdone. Not to mention that Germany's standard of "renewable energy accounts for 80 per cent of power generation" is still the highest in the world; the US House of Representatives recently passed a climate-related bill of nearly $400 billion to encourage the development of solar and wind energy. Geopolitical wars may interfere with trends, but they cannot affect the ultimate direction of trends.

And in the field of carbon neutralization, China has a higher level of consideration in addition to industrial interests. Even if Europe and the United States do regress, we still have to do it.

As Academician Ding Zhongli said in an interview: we have to do it. Because what China has done is to thoroughly solve the problem of air pollution, China's approach and government are purely viewed from the perspective of the great development of the country, and we are considering the real social well-being.

And new energy is also playing a role. For example, in Shandong and Henan, many villagers installed photovoltaic on the roof, and power generation can also be sold for their own use. After seven or eight years, it will be profitable in the next ten years, and it can also become a revenue project. There are also many factories through photovoltaic and energy storage to replace thermal power consumption, environmental protection and save money.

But it is undeniable that the construction of new energy is not achieved overnight. In 2021, China's landscape power generation accounts for only 12% of social electricity consumption, and there is still a long way to go to replace traditional energy to replace thermal power and become the main force.

As IDG Capital, which has been involved in new energy investment since 2005, said, the new energy industry is a standard manufacturing industry, downstream demand is not a simple linear growth, the factors that affect demand side fluctuations are many and complex, and will not show short-term explosive growth like the Internet and other industries. On the supply side, there is also a periodic mismatch caused by different release rates of manufacturing capacity in each link, so cyclical fluctuations have become a feature that can not be ignored in this industry.

In fact, since 1949, new energy construction has indeed experienced ups and downs: the infancy period from 1949 to 2004, the youth exploration period from 2005 to 2020, and now it has just entered the adolescent development period. However, what is certain is that the current iterations and difficulties and problems are only a matter of "rhythm", not "structure".

This is not the first time that China's new energy industry has gone through the cycle. China's new energy construction, will still be steady pace, to achieve an "ideal sublimation".

Sprouting in childhood: wind power comes first

A country's energy system is the "blind box of nature". Saudi Arabia has opened the world's best-selling oil black gold, Russia has released the natural gas that Europe has always dreamed of, while China's blind box is "rich in coal, poor in oil, and less in gas." Therefore, the energy structure of our country develops and develops step by step around coal.

However, the pollution problem caused by coal has been paid more and more attention by the society. China also began to explore new energy early, looking for and making use of other gifts given by nature, such as hydrogen, light, wind and so on.

Hydrogen energy is known as the ultimate clean energy, and China will not miss it. An important research area of the Institute of Science of Dalian University, established in March 1949, is "hydrogen fuel cell". Since the 1990s, institutions and colleges such as Changchun Ying Chemical Institute, Tsinghua University and Tongji University have also begun to do research and development on fuel cell parts and vehicles, which can be said to have started no later than Toyota of Japan. But unfortunately, what we get is almost zero commercialization.

Photovoltaic started much later. In 2000, Germany promulgated the Renewable Energy Law, which led to the development of photovoltaic industry in China. Shi Zhengrong, who studied under the photovoltaic pioneer, returned to China from Australia with technology and 400000 US dollars, visited local governments, and finally knocked on the door of Wuxi. Later, the tall buildings of Suntech in Wuxi rose, entertained guests and collapsed. However, at this time, the photovoltaic industry "equipment, raw materials, market" outside, also can not afford to be of great use.

In the exploration stage, the prettiest boy in the village is still wind power. In 1986, Shandong Rongcheng Malan Wind Farm introduced three advanced units from Danish companies and established the first onshore wind farm in China. Then came the Dabancheng Wind Farm, the largest in Asia at that time. But the equipment is still purchased overseas, and the Danish experts who repair the equipment once charge about the annual income of eight domestic workers. Therefore, localization has become the core proposition.

Engineers in our country can only disassemble and assemble in reverse, start with parts, learn little by little, and build little by little. In 1998, Xinjiang Xinfeng Science, Industry and Trade Company was registered and established. A year later, the first domestic wind turbine was finally developed, which was used in power plants connected to the grid in 2001. The history of nearly 20 years of foreign monopoly on China's wind power market is over. Xinjiang Xinfeng Science, Industry and Trade has also changed its name to Xinjiang Goldwind Science & Technology, which we are more familiar with.

Wind power can be the first to grow during the exploration period, which is not only related to the external procurement of equipment, but also to the breakthrough of independent research and development in our country. However, considering that most of the ways to reduce the cost of wind power are "physical" properties such as large-scale leaves, while photovoltaic and hydrogen energy are material-driven "chemical" properties, the latter reduces cost and efficiency more significantly, and the ceiling is higher, therefore, the construction of a new energy system, we still have to go to photovoltaic, hydrogen energy and other fields.

By 2003, China's new energy system, including wind power, solar energy, biomass energy, etc., is still very small, equivalent to about 52 million tons / year of standard coal, accounting for only 3% of the country's total primary energy consumption. The supremacy of thermal power is difficult to shake. The ideal of new energy is beautiful but slim, until a big signal breaks the silence.

Exploration: two turns of photovoltaic

In February 2005, China's Renewable Energy Law was adopted and is scheduled to be implemented on January 1, 2006. This is a signal that opens the prelude to the development of new energy. Keen entrepreneurs from all over our country are on the move one after another. The biggest change is in photovoltaic.

Jingao Solar, Hesheng Silicon Industry, JinkoSolar Holding Co Ltd and other companies were established in 2005 and 2006; Longji shares of Trident Ju decided to transform from semiconductor materials and equipment into the field of photovoltaic silicon wafers; Tongwei shares, which are already the leader in the feed field, also invested in the field of silicon materials; Zhengtai, which is engaged in low-voltage switching business, began to set foot in household photovoltaic.

Entrepreneurs can feel the temperature of the water for the first time, and forward-looking investors begin to plan the layout. For example, IDG Capital also captured the changes of the new energy industry in 2005, taking the lead in setting up a special investment team in China to focus on new energy investment team, studying overseas industries, tracking domestic development, and establishing a cognitive framework.

At the end of the industry, entrepreneurs and investors will be full of longing. However, reviewing the course of photovoltaic development in China, the only thing that the forerunner can determine is "reducing cost and increasing efficiency", and what is unimaginable is "tragic and inward volume". Among them, there are two technological U-turns, which put one group of players on the "first-class seat" and left behind another group of players.

The first turn took place around 2011, when the crystalline silicon battery squeezed the thin-film battery out of the car. At that time, since 2004, thin film batteries rely on the advantage of performance-to-price ratio, and the market share has been rising from about 5% to 20%, which is on a par with crystalline silicon batteries. However, between 2008 and 2009, with the outbreak of the financial crisis and the tightening of subsidies in the global solar industry, the price of polysilicon plummeted by 70%, the cost of thin-film cells no longer had an advantage, and the market share continued to fall to 3%.

The second turn took place between 2015 and 2020, when the single crystal wafer system threw the polysilicon wafer system off the car. The leader of monocrystal wafer technology is Longji, which cut into the "no man's land" monocrystalline wafer when polysilicon wafers were popular in 2006. In 2013, Longie became the world's largest producer of single crystal silicon wafers.

However, a single flower does not make a spring. If single crystal silicon wafers want to develop continuously, they must form good ecological support in batteries, components and other fields. In 2016, single crystal silicon wafers accounted for only 20% of the market. But change is taking place, especially in battery technology.

There are many photovoltaic cell technologies, BSF technology is dominant before 2016, and the research and development of PERC technology has been accelerating since 2015. PERC battery is better matched with single crystal silicon wafer and has higher utilization efficiency, so PERC is an important driving force of single crystal silicon wafer system and needs to make a breakthrough, while the two important players are Lonji and Aixu.

Longie bought Leye in 2014 and ended up in the battery and module business himself. And Aixu shares, as a professional battery company, also took the lead in achieving a breakthrough in research and development.

Aixu shares in China's Golden Sun Project just launched in 2009, but also seized the opportunity and got off to a good start. Aixu initially produced polysilicon wafer batteries, but took the lead in mass production of single crystal PERC batteries in 2017, and Ai Xu's single crystal PERC batteries shipped first in the world in 2018.

There is no doubt that the breakthrough is due to Aixu's great efforts in research and development, and in 2016, Aixu also received a large amount of "food supplies" from IDG Capital.

The members of the new energy investment team of IDG Capital who made this decision are rich in structure, both from the technology side and the industry side. Jun Shi Energy, a thin-film battery company, was invested in 2008, when it was the spring breeze of thin-film cells, with considerable technology and scale.

Then China's photovoltaic industry has experienced shocks such as the reduction of photovoltaic subsidies caused by the global financial crisis in 2009 and the "double evils" in Europe in 2012, the pressure on entrepreneurs has increased sharply, and investors have begun to wait and see.

But IDG Capital believes that photovoltaic can transform the energy industry from "resource-driven" to "technology-and manufacturing-driven". The trough of the industry will surely pass, and the industry will be led by companies with advanced disruptive technology or manufacturing advantages.

This is exactly the case with investing in Aixu.

Before the investment, IDG Capital team has been in contact with Aixu founder Chen Gang for many years. Through long-term exchanges and research, IDG Capital recognizes Aixu's team very much and firmly judges: technological changes are taking place in the battery field, and PERC replacing BSF is a trend that is worth looking forward to and likely to occur.

At the end of 2016, the IDG capital team invited Chen Gang to meet with several partners while in Zhuhai, and finally decided to invest 900 million yuan in Aixu shares, making it the second largest shareholder in Aixu, which was also a large sum in the relatively depressed primary market of new energy at that time.

IDG Capital brings not only money, but also confidence. IDG Capital and Aixu team agree that it is necessary to increase research and development and grasp technology dividends. Aixu shares are full of firepower, and R & D spending increased by 54% in 2017, exceeding 100 million yuan, and then spent another 200 million yuan the following year.

Those who give money give boldly, and those who spend money spend boldly. Of course, one minute on and off the stage for ten years of work, whether enterprises or investment, the moment of decision, are derived from long-term accumulation.

Not only capital, IDG Capital has also brought industrial resources to Aixu, matchmaking to help Aixu land factories and expand production capacity in Yiwu, Tianjin, Zhuhai and other places. Aixu's income in 2016 was close to 1.6 billion yuan. Three years later, it increased to 6 billion yuan, and its profit expanded fivefold to nearly 500 million yuan.

Aixu's PERC technology breakthrough has not only brought about improvement in the company's management, but also promoted industry change. More and more players are joining the PERC battery. PERC's market share was about 10 per cent in 2016, but it reached 65 per cent in 2019 and 91 per cent in 2021. The market share of single crystal silicon wafers has also reached 90%.

Longji and Aixu both advanced, and entrepreneurs and investors all used time to prove and fulfill their cognitive judgments.

Of course, just as teenagers need to go through adolescence, new energy at this stage has also experienced restlessness, bubble, development and harvest. For example, in the photovoltaic field, homogenization and overcapacity occur at the production end from time to time, while at the consumer side, there are also phenomena such as cheating and abandoning light. But photovoltaic "good young people" are always self-growing.

With two major technological turns and many industry obsolescence, especially the "531 New deal" in 2018, which accelerated the elimination of backward production capacity in the industry, forcing entrepreneurs to constantly find ways to reduce costs, finally, in 2021, photovoltaic entered the "era of parity". Do not rely on subsidies to complete the handover with thermal power. The construction of the new energy system has finally come out of the exploration period of youth and come to the period of development.

Exhilaration: the upsurge of photovoltaic change

The strategy of "carbon neutralization and carbon peak" in 2020 is a reassurance for new energy practitioners. Longji, Tongwei and other big companies have raised funds to expand production, and new players have also stepped in: TCL, which is dominated by color TV and panel business, has taken control of Central shares and expanded its silicon wafer business; Shaanxi Coal Industry has also participated in the wave of new energy by buying shares of companies such as Longji and Ganfeng Lithium.

The new technology of silicon material, the large size of silicon wafer, the change of battery technology and so on. Time does not wait for the wind, blowing a wave of change.

In 2021, JinkoSolar Holding Co Ltd, who was listed in the United States, returned to Science and Technology Innovation Board, which took only six months from acceptance to listing.

And the vigorous development of the industry also infects practitioners. Xu Zhiqun, JinkoSolar Holding Co Ltd's former chief operating officer, offered to resign in November 2020. Then he came to Gaojing Solar Energy Company, which was just established for more than a year, and served as CEO, which opened the way to start a business.

Xu Zhiqun dares to take the road of starting a business, which can be said to be "no porcelain work without diamond". Xu Zhiqun graduated from Jilin University, majored in semiconductor materials and chemistry, and successively worked in a number of photovoltaic companies. after coming to JinkoSolar Holding Co Ltd in 2008, he became the core of research and development. the slurry recovery process reduced the cost by 80% from 50 million yuan. And Xu Zhiqun is also the core personnel in the implementation of Jingke vertical integration strategy, and he also knows very well about the upstream and downstream of the industrial chain.

Two heads are better than one. Besides Xu Zhiqun, Gaojing Solar also has good shareholder strength, including state-owned enterprise Zhuhai Huafa Group and IDG capital in the field of new energy. Subsequently, shareholders have also increased Aixu, Midea and other industrial capital.

This powerful entrepreneurial journey is inseparable from the "thread-piercing" that IDG Capital launched before the introduction of the dual-carbon strategy.

In September 2020, IDG Capital team met with Xu Zhiqun for the first time. Xu Zhiqun thought he was just talking about industry, but he didn't expect to talk about a major event of his life in a small restaurant in Yiwu.

The opportunity for this meeting will start with the "531 New deal" in 2018. At that time, after the state announced that it would stop paying subsidies for photovoltaic power generation, dark clouds hung over the photovoltaic industry and A-share photovoltaic plate fell continuously.

But IDG Capital believes that, "this time to subsidize, it shows that the economic model has been established." The essence of energy transformation is still the process of stock demand substitution, and one of the keys to achieve substitution is the establishment of economic model, so that large-scale industrialization infiltration can be realized in the upper and lower reaches of the industrial chain in the future.

The real establishment of the economic model can not rely on policy subsidies, but the cost caused by technological progress and scale manufacturing can be really reduced. So the year after '531' is actually a good time to invest in new energy. "

The silicon wafer field seems to be stable, but in fact there is an opportunity: large size brings a new pattern window. Just like investing in Aixu, IDG Capital once again set up Gaojing Solar Company with Huafa Group when the industry was at a low ebb. The next step is to find the "best commander" for Gao King.

IDG Capital team and Xu Zhiqun met for nearly four hours at their first meeting in Yiwu. A week later, Xu Zhiqun met with IDG Capital again based on his understanding of industry trends and decided to start a business.

When the stage is set up, the singing will be in place and the opera will begin to sing. Xu Zhiqun began to form groups and talk about resources, while shareholders were not idle. Huafa Group provides Gao King with "nanny-like" services to solve land, plant, hydropower and other problems; IDG Capital also acts as a co-founder to find people, money and business, and promotes the cooperation between Gao King and Aixu.

Nowadays, the photovoltaic industry is very popular for integration, and leading companies have to do everything, but Gaojing's silicon wafer and Aixu's battery chip can give full play to the advantages of professional division of labor and cooperation. Gaojing's current capacity planning is as high as 80GW, which is half of Longji's capacity and ranks third in the industry.

The prospect determined by the photovoltaic industry will inevitably lead to a wave of competition to reduce costs and increase efficiency. At the same time, in order to smoothly replace thermal power, photovoltaic must solve the problem of unstable output and impact of grid connection, which requires energy storage to "pick up the horse and send a ride".

Energy storage: enjoy dividend spillover

Energy storage is not new, pumping power stations are one of the common ways, and the other is electrochemical energy storage, that is, batteries. Electrochemical energy storage does not depend on topography and is easy to install, so it is the best companion of photovoltaic. In 2022, energy storage will become the brightest star in the capital market, with both performance and related companies' valuations and market capitalization rising sharply.

An electrochemical energy storage system can be divided into three parts: battery, converter and system. The development of energy storage, in a sense, enjoys the "technology dividend spillover" in other areas. For example, the battery is spilled by the new energy vehicle; the converter is spilled by the photovoltaic inverter technology; the system is spilled by the electric vehicle. Of the three parts, the battery is the big one. The development of batteries is driven by three lines:

One is the technology line, from lead-acid batteries to lithium iron phosphate, ternary lithium, sodium ions, semi-solid, solid-state, etc., every technological change will lead to the decline and rise of companies, which has also contributed to the reduction of battery costs by more than 70% since 2014.

The second is the market line. In 2016, industry subsidies were very high, with more than 200 battery companies, but with the gradual reduction of subsidies and increased market competition, there were only about 30 by 2019, a decrease of 85%.

The third line is iteration and transformation. The Ningde era, for example, evolved from ATL, a consumer electronics company, and Great Wall Motor hatched honeycomb batteries. Xinwanda EVB, which recently completed 8 billion yuan of financing, is also a typical example of iterative development from the consumer electronics business.

Xin Wanda was founded in Shenzhen in 1997 as an OEM supplier of batteries, while Wang Mingwang, the founder, already had two entrepreneurial experiences in the battery field, but both ended up with a separation proposed by the head of the market. In 2011, Xinwanda entered the Apple Inc industrial chain by virtue of its cooperation with ATL, and its business accelerated. Under the highlight of consumer electronics, Xinwanda's car power battery business also tested the water as early as 2008. But the key step is 2017.

In 2016, global smartphone shipments grew by only 2.3%, which is in sharp contrast to the growth rate of more than 10% in the past, and Xin Wanda management is keenly aware that the peak of mobile phones is almost over. We must look for a new growth curve; but at the same time, in 2017, subsidies for new energy vehicles also began to reduce, car companies will transfer the pressure to battery companies, and there is even public opinion that the trough of the battery industry is coming.

Does the battery business need to be overloaded or not? After evaluating its own strength and judging the trend of the new energy vehicle industry, Xinwanda launched a fixed increase, raising 2.5 billion yuan, of which nearly 2 billion yuan was invested in power batteries.

On the other hand, IDG Capital, which is mainly based on the primary market business, has also participated in the fixed growth in the form of products. This is once again when IDG Capital enters the board at the "trough" of the industry that outsiders think, and bows itself into the game. The partner of IDG Capital becomes a director of Xinwanda and participates in the business development decision-making of the company.

Although they are all called batteries, there is still a big difference between the consumer level and the car specification level. Therefore, IDG Capital invited Guangzhou Automobile Group's retired vice chairman to give lectures to Xinwanda to help Xinwanda enhance its understanding of the car factory and recruit people from the car system, laying the foundation for the split of Xinwanda's power battery business, and meetings with Xinwanda are also commonplace. The two sides will discuss the needs and types of customers in each car system and study customer development strategies.

It is precisely because of long-term concern and companionship that IDG Capital continues to raise bets in the financing that Xinwanda has just concluded to support excellent enterprises to seize the tuyere to better "fly".

Not long ago, Guangzhou Automobile Group also announced an investment of 10 billion yuan to start the independent battery strategy. The competition for batteries also continues. The technical dividend of power batteries also spills over to energy storage, making the cost of energy storage even lower.

In the field of energy storage converters, it is still Sunshine Power and other companies that lead the market, giving full play to the advantages of technology, cost and brand accumulated in the main battlefield of photovoltaic inverters, while in the field of systems, not many people may have heard of the company that ranks first in shipments. the name is Hyboschon.

In 2010, Zhang Jianhui, a master's degree in electrical engineering from Tsinghua University and a PhD in electronic engineering from Berkeley, California, returned from the United States to start a business. based on the optimism about the trend of electric cars in China, two alumni, both returnees and bulls, set up a new company in Tsinghua Science and Technology Park. it is named Hiboschuang, implying that "a group of returnees want to start a business."

Zhang Jianhui once worked for the National Semiconductor Company of the United States, in charge of electric vehicle battery management system, the technology is quite excellent. The original office of Hyboschuang is only 10 square meters, and the start-up capital is basically the accumulation of senior executives a few years ago, but they soon have products with independent intellectual property rights and gradually open up the market. It got involved in the energy storage business again in 2011.

Although Hyboschuang is a star lineup, it will not be able to usher in the real first year of the domestic energy storage explosion until 2021. However, during this period, the company is not lonely, accompanied by Enlightenment Incubator, IDG Capital, Tsinghua Holdings and other institutions.

When IDG Capital invested in Hypox in 2015, its business was still dominated by power batteries, but at that time IDG Capital was convinced through research that Hybosch's technology would have a great application prospect in the energy storage business in the future. In 2021, Hyboschuang confirmed their judgment with the performance of about 1500MWh and the first shipment of energy storage system.

If we say that before this, energy storage enjoyed the development and growth of technological dividends in other fields, then in the next decade or more, energy storage will begin to feed back to provide stable and reliable helpers for the development of electric vehicles, photovoltaic and other industries, and become an indispensable part of the new energy system.

Development: the Future expectation of hydrogen Energy

Looking at the enthusiasm of the photovoltaic and energy storage industry, it is easy to think of the hydrogen energy of "getting up early and catching up in the evening". For a long time in the past, the development of hydrogen energy was relatively slow. Fortunately, all the companies in the industry are still holding on.

For example, in 2005, a laboratory of Shanghai Jiaotong University was exploring the application of batch manufacturing technology in the field of fuel cells, and developed a high-performance air-cooled and water-cooled stack prototype. "of course, hydrogen energy should be developed, and the key core technologies should be firmly held in the hands of the Chinese people. "

It was followed by a long period of silent progress, until 2017, when the early team came out of the laboratory and set up Shanghai hydrogen Chen New Energy Technology Co., Ltd., to commercialize. Three years later, that is, in 2020, the company finally achieved mass production.

This breakthrough was also captured by the IDG Capital Investment team. In May 2021, the IDG Capital team and Hechen communicated for more than three hours at the factory building in Shanghai Lingang Park, which led to the subsequent cooperation. IDG Capital still follows the underlying logic of judging the new energy industry-where the path to solve the industry's principal contradiction lies, where the opportunity lies. One of the main contradictions of hydrogen energy is to reduce the cost, and the hydrogen morning team has strong technical and market-oriented ability, which will form a clear cost reduction path.

In fact, the hydrogen industry is indeed resolving contradictions. Since 2020, there have been new changes in the industry:

The first is that the scene is new. Hydrogen fuel cells do not compete with lithium batteries, but cut into scenarios with higher life requirements, such as heavy trucks and ships, to complement lithium batteries.

The second is to produce new products. In the past, hydrogen was mostly produced by chemical industry or coal, but now it can be produced by photovoltaic electrolysis of water. It not only solves the problem of photoelectric absorption, but also can use hydrogen in metallurgical and petrochemical and other industrial fields to improve energy efficiency, or as energy storage to achieve energy transfer.

In particular, the industrial incentive policy in the field of hydrogen energy has been changed to "replaced by awards", which is more conducive to the accelerated development of excellent enterprises. Yihuatong in Beijing, Guohong hydrogen Energy in Foshan, reshaping shares in Shanghai, Jethydrogen Technology, hydrogen Chen and other companies are all raising funds to replenish ammunition while stepping up research and development and commercialization. In addition to hydrogen Morning, IDG Capital has also invested in reshaping, Jethydrogen and other companies.

In fact, it is not easy to invest in hydrogen energy in these two years.

The whole industry will sell more than 1500 vehicles in 2021, which has no status compared with lithium trams. However, whether it is an enterprise or an investment, on the one hand, it should be reverse, forward-looking, and come when there are few people; on the other hand, we should have a deeper understanding of the industry. IDG Capital, which has been immersed in the energy industry for more than ten years, firmly believes that comprehensive decarbonization has become a consensus and core driving force. Layout hydrogen energy is also the layout of the future.

So far, the new energy team with "wind power and photovoltaic as the backbone, energy storage as an auxiliary, hydrogen energy as a high-potential outbreak reserve, and nuclear power waiting policy" has gradually taken shape.

The end.

The consensus on new energy has been continuously strengthened, but the construction of a new energy system has not been achieved overnight. Just like human growth, the construction of new energy system needs "evolution": the evolution of policy, enterprise and investment.

Policy has been evolving. At the beginning of the industry, the state uses subsidies to stimulate the enthusiasm of enterprises, which is positive and effective, despite bubbles such as fraudulent compensation. Today, policy also has a more scientific paradigm, continuing to use subsidies to guide breakthroughs in core areas, but subsidies are more accurate, such as hydrogen energy industry policies that "replace compensation with awards": let outstanding enterprises get more rewards and accelerate the survival of the fittest.

Companies are also evolving. For example, Longji from semiconductor to photovoltaic, and from wafer to integration strategy; Hibosch from automotive battery BMS management, to grid intelligence, energy storage system; Aixu battery from BSF to PERC to TOPCON, HJT and other technologies. Regardless of photovoltaic, wind power, energy storage, hydrogen energy, the technology iteration is still rolling forward.

The IDG capital team has concluded that the development of the energy industry will go through two major stages: the first stage is the cost reduction superimposed technology and product maturity, leading to the establishment of an alternative economic model; the second stage is product value enhancement accompanied by rapid infiltration. The characteristics of the two stages of industry development are very different, and the risks faced by enterprises as well as the funds and human resources required are also very different. Therefore, enterprises need to evolve constantly.

Investment institutions also need to evolve. New energy is also a manufacturing industry, from the perspective of development history, whether it is technology or supply chain, to the final level can be pulled up, scale effect to a certain stage, the marginal effect will decrease. The core difference of the enterprise lies in the difference of the entrepreneur, how to iterate the technology, understand the market, sell the product better, manage the scale manufacturing well, and realize the maximum cost reduction.

The understanding of entrepreneurs is not only to understand people, but also to understand things. This puts forward high requirements for the cognition of investment institutions. For example, half of the new energy investment team with more than engineering PhD,20 personnel in IDG Capital have experience in the energy industry, and their experience on the technology side, equipment side and understanding through the industry cycle have helped them form a systematic industry research system. This also has the IDG capital again and again in the industry trough when the firm.

The other side of evolution is actually persistence.

Investment institutions need to persevere. Since 2005, IDG Capital, which took the lead in entering the Bureau, has experienced several cycles of the development of the new energy industry, and has laid out about 30 new energy enterprises, including photovoltaic, electric vehicles, power batteries, energy storage, charging piles, hydrogen energy and other sub-fields, and has accumulated important cognitive methodology.

Reviewing the case of IDG Capital investing in new energy, hydrogen energy in 2021, batteries in 2017 and energy storage in 2015 were all completed at a time of "trough" in the industry. In fact, it looks like a trough, but in fact, it is also a time when they judge an important turning point in the industry, believing in technological innovation and the energy revolution in order to withstand a round of cyclical fluctuations.

Enterprises also need to persevere. It's like the founder of Xinwanda started two businesses and failed twice, but still chose the battery field for the third time. Just like hydrogen Chen, it has been 18 years since 2005, and this is also the time for a newborn baby to grow up, and which of the leading companies in various fields of new energy has not experienced the darkest moment of the industry?

The development of new energy is cyclical, and the cycle is experience. Entrepreneurs and investment institutions who have experienced peaks and troughs will also have a more penetrating point of view, deeper understanding and more patient patience, rather than regarding the "stage mismatch problem" as a "continuous structural problem".

Looking back at the construction of China's new energy system, the more important driving force is the determination and confidence of the country and the endogenous driving force of the industry. From the demand to improve the environment and energy structure at the beginning of the founding of the people's Republic of China, to the grand blueprint of "promoting the responsibility of building a community with a shared future for mankind and realizing the inherent requirements of sustainable development", from a small ideal to a big ideal.

At the moment of carbon neutralization, China's new energy, which passes through the cycle of energy revolution, is not only an industrial revolution, but also an ideal sublimation, there will still be greater ideals waiting to be realized. When human beings really move towards carbon neutrality, we will be extremely proud of our persistence.