Chapter 995
: An order from the official authorities, signing a memorandum of understanding.
After the technical preview of the second-generation Xuanwu battery was released, Wang Donglai's office was never quiet.
First, purchasing directors from domestic and foreign automakers inquired about the specific dates of the negotiation meeting through various channels. Then, product vice presidents from smartphone brands tentatively asked about the price reduction potential of first-generation batteries. Later, even people from the energy storage industry came knocking on our door.
The operators of several large photovoltaic power plants in the Northwest directly contacted Galaxy Energy's sales department through connections, asking if they could be given priority in supplying goods.
Liao Qingfeng carried a stack of documents in and out every day, his face showing both excitement and exhaustion, with bloodshot veins still visible on the whites of his eyes.
But Wang Donglai hasn't met with anyone from any company in the past few days.
He delegated all business negotiations to Liao Qingfeng, and locked himself in his office to review the second phase of the Shennong Project's field experiment plan, occasionally glancing up at the tower cranes turning at the Tanghuangcheng construction site outside the window.
He has already laid out the conditions: the technical data of the second-generation battery, the expected price reduction of the first-generation battery, and the general direction of the production capacity plan. Now all that is to do is wait.
Let the market digest this shock, and let the expectations of various companies ferment to a sufficient level before sitting down at the negotiating table.
However, a call came directly to his office.
The call was from Wu Qingsong of Tangdu City, whose tone was as calm as ever: "Comrade Donglai, some comrades from Beijing are coming over and would like to discuss the cooperation between energy storage and Xuanwu Battery with you in person. Is that convenient?"
The answer, naturally, is as expected.
Wang Donglai put down the phone, remained silent for a moment, then his lips twitched slightly. He called Liao Qingfeng over and said, "Compile a list of the actual test data for the second-generation battery in the energy storage sector. We need it this afternoon."
He didn't explain the meeting room, tea, or seating arrangements, and Liao Qingfeng didn't ask any further questions.
Having worked for Wang Donglai for so many years, Liao Qingfeng knew all too well how this boss treated people.
When friends come over, we welcome them with good wine; when discussing cooperation, we stick to the contract; and those who try to use moral blackmail should be asked to leave immediately.
This confidence didn't fall from the sky; it's born from a series of globally leading technologies as our trump card.
In the afternoon, in the reception room on the top floor of Galaxy Technology's headquarters.
Wang Donglai stood at the elevator entrance five minutes early.
As soon as the door opened, Wu Qingsong was the first to walk out. Tangdu City was his home turf, and Galaxy Technology was the core engine for the development of Tangdu City and even Qin Province. He would never be absent from any event at Galaxy Technology.
Moreover, this collaboration involved representatives from the Beijing Development and Reform Commission and the power sector—both powerful departments. With them present, the collaboration was bound to receive some respect.
The two exchanged a glance, and Wu Qingsong nodded slightly with a smile.
According to Wu Qingsong's introduction, the leader was Lao Zhou, the deputy director of the Beijing Development and Reform Commission. The other three were Han Wei from the State Grid Corporation of China, Mr. Sun, the head of a new energy investment platform of a central enterprise, and Liu Dehai, the deputy director of the Southern Power Grid, who was in charge of energy storage planning and grid dispatch.
Wang Donglai noticed that Wu Qingsong's tone was more cautious than usual when introducing Liu Dehai, not a word more or less, but exactly focusing on the three words "deputy director".
He immediately realized that something was off about Liu Dehai in Wu Qingsong's mind.
But he didn't show it; he just smiled, reached out and shook hands with Liu Dehai, and said, "Welcome."
After taking their seats in the meeting room, Wu Qingsong did not speak, but handed the situation over to Wang Donglai and Director Zhou.
Director Zhou didn't mince words: "Donglai, to be honest, we came here for the second-generation Xuanwu battery. We already know the performance of the first-generation battery very well. Several photovoltaic and wind power bases in Northwest China are using your Xuanwu battery for energy storage pilot projects. The operating data for the whole year last year was excellent. The charge and discharge efficiency, cycle life, and low-temperature performance all far exceeded all the solutions we had used before."
He opened a thick folder in front of him and pushed several pages of key data to Wang Donglai: "But there are some problems. The cost of energy storage is still too high. The levelized cost of electricity (LCOE) of photovoltaic power plus energy storage is much higher than that of coal power. If we want to fully promote the replacement of fossil fuels with clean energy, the cost of energy storage must continue to be reduced. So after seeing the technical preview of your second-generation battery, several departments of us held a meeting overnight to discuss this with you in person."
Wang Donglai nodded and pushed over the complete data sheet for the second-generation battery. The data sheet was filled with dense parameter comparisons, including the energy density, low-temperature degradation, cycle life, and fast charging rate of the first and second generations. Each item was marked with the measured value and the number of the third-party testing agency.
"You leaders can look at the performance data of the second-generation battery yourselves. I won't read it aloud, but I'll just pick a few that are directly related to energy storage."
His voice was not loud, but his rhythm was very steady as he introduced: "The energy density is more than 30% higher than the first generation, which means that the footprint of the same scale energy storage power station is greatly reduced, and the infrastructure cost is reduced accordingly; the low temperature performance breaks through minus 40 degrees Celsius, and the capacity retention rate exceeds 90%, which means that winter energy storage in the Northwest and Northeast no longer requires additional insulation energy consumption; the cycle life is doubled, it supports ultra-fast charging, and the design calendar life exceeds 20 years, and the cost per kilowatt-hour of the whole life cycle is reduced by a lot compared to the first generation."
Han Wei's eyes lit up.
This veteran engineer, who has spent most of his life working in the power system, understands better than anyone the significance of energy storage to the power grid. Wind and solar power are unstable, and without energy storage, we can only rely on thermal power for peak shaving.
However, the cost of energy storage has been a persistent bottleneck, slowing down the development of clean electricity as a whole.
The first-generation Xuanwu battery performs very well, but it is still a bit pricey.
Now that the second-generation Xuanwu battery is out, the price of the first-generation battery will inevitably drop. Perhaps by talking to Wang Donglai, we can control the price to a range that allows for wider adoption while remaining acceptable.
Thinking this, Han Wei leaned back in his chair, slowly exhaled, and said in a slightly trembling voice, "Academician Wang truly deserves to be called a world-class scientist. In such a short time, he was able to improve the performance of the first-generation Xuanwu battery by such a high standard. It is a great blessing for the country to have a talent like Academician Wang!"
Liu Dehai also spoke after Han Wei.
His voice wasn't loud, but it carried a sense of tact unique to someone who had long been involved in government offices and was accustomed to navigating complex situations. It was neither forceful nor overtly sarcastic: "President Wang, we all highly approve of the performance of the Xuanwu battery!"
"However, there is one point: energy storage is different from consumer electronics and automobiles; it is not a purely market-driven activity. Electricity is a public utility, and energy storage is the infrastructure of the power system. If prices cannot be lowered, the general public will ultimately pay the price. Could Galaxy Technology consider providing us with a cost price for energy storage supplies? After all, you have grown up in the domestic market and under the favorable policies, and it is only right that you give back to society now."
The entire reception room fell silent for a moment.
Wu Qingsong paused in mid-air with his teacup in hand, his brows furrowing almost imperceptibly.
Han Wei glanced at Liu De with some surprise, then lowered his head to flip through the data tables, seemingly suddenly developing a strong interest in a particular chart.
Mr. Sun raised his eyebrows, his expression not changing much. Instead, he looked at Wang Donglai with great interest, waiting for his reaction.
Wang Donglai did not answer immediately. He picked up the cup of tea on the table, took a sip, and put the cup down with a very soft clinking sound. Then he slowly raised his head to look at Liu Dehai, a faint smile on his lips. His voice was gentle and calm, but every word was clear, like a sharp knife tip gently gliding across paper. Every stroke landed precisely on the paper, not harsh, but uncompromising.
"Director Liu, could I understand what you just said as follows: electricity is a public utility, so Galaxy Technology should make concessions in energy storage supply; Galaxy Technology grew up in China, so it should give back to society and supply at cost price, instead of making as much profit as it wants? Is that what you mean?"
Liu Dehai's smile froze slightly, and he nodded.
"Then I'll just say it directly."
Wang Donglai's tone remained gentle, but his gaze had turned serious: "The pricing of Xuanwu batteries has never been a simple matter of 'cost plus profit.' R&D investment, material purification, production line depreciation, quality inspection standards, patent protection, and customer customization all cost money. We spent a lot of money on battery R&D last year. Where did this money come from? From the profits of the first-generation battery."
"If we supply at cost price, where will the money for the next generation of R&D come from? After the first generation, there will be a second generation, and after the second generation, there will be a third generation. If each generation is supplied at cost price, how will the R&D team be paid? How will the employees support their families? How will Xuanwu Battery maintain its technological leadership? Cooperation can be discussed, and prices can be adjusted according to the purchase volume, but supplying at cost price, I'm sorry, Galaxy Technology cannot do that."
His tone was so calm it barely rose and fell, but each question mark was like a nail, piercing through Liu Dehai's logic—which revolved around public utilities, giving back to society, and what was right—and laying it all bare on the table.
Liu Dehai's face flushed slightly, and he unconsciously tapped his fingers twice on the sofa armrest. His voice was a few decibels higher than before: "President Wang, battery raw materials need upstream suppliers, right? Mining permits for lithium, cobalt, nickel, and other minerals..."
Wang Donglai suddenly laughed.
There was no contempt or anger in that smile, only a frankness and calmness that surprised everyone.
He leaned back in his chair, teacup still in his hand, his voice now carrying a hint of elder-like patience: "Director Liu, Galaxy Technology's lithium and cobalt ore procurement is done through a global supply chain. If someone tries to cut off our raw materials, we'll switch to another supplier. If that's not possible, we'll change our technology. The Xuanwu battery's process is inherently adjustable, making it far less dependent on raw materials than traditional batteries."
"But I don't want to beat around the bush today. If you want to talk about cooperation, fine, let's discuss the contract, price, and terms one by one. But if you want me to supply goods at a loss, then I can only say no. This is not about disrespecting you, but about being responsible for the labor of everyone at Galaxy Technology. R&D, production lines, quality inspection, and those workers in the workshops—their wages cannot be reduced, their year-end bonuses cannot be reduced, and their dignity cannot be reduced."
Liu Dehai's face darkened completely. His lips moved as if he wanted to say something, but Wu Qingsong interrupted him with a light cough.
He had barely spoken since he came in, having been observing the situation, but suddenly put down his teacup and spoke in a casual yet weighty tone.
"Donglai has already made his point clear: this is a business transaction, and business is business. Galaxy Technology's R&D investment, employee costs, and production line depreciation are all real money. These costs are there for all to see, and a cost price is unrealistic."
"As a company, Galaxy Technology is already very good at developing such a world-leading product."
Then, Wu Qingsong looked at Wang Donglai, changed the subject, and said in a tone that was precise and tactful honed through years of coordination: "Energy storage does have the attributes of a public service, but public service does not mean that companies should suffer losses. Purchasing prices should be tiered, with discounts for large quantities. This is sound business logic everywhere."
"The energy storage procurement plans for those bases in the Northwest are quite large. Could we negotiate a better price for that volume separately?"
"In addition, you have always wanted to promote the consumption of clean electricity. Once this is done, the installed capacity of Xuanwu batteries in the energy storage field will far exceed the total of automobiles and mobile phones. This is not a one-sided concession, but a win-win situation."
Wang Donglai looked at Wu Qingsong and naturally knew what Wu Qingsong was doing. Smoothing things over was just a facade; his real intention was to deflect Liu Dehai's moral blackmail.
Moreover, Wu Qingsong's last words were essentially handing him a pass: If you want volume, I'll provide volume; if you want policy support, I'll provide policy support, but the price cannot be pushed below the cost line—that's the bottom line.
“Manager Wu, the larger the energy storage purchase volume, the more favorable the price can be, which is the law of the market. But you are right, tiered pricing must be linked to the purchase volume, the cooperation period, and the payment cycle. I can show my sincerity first. After the cooperation is reached, we will coordinate a portion of the factory capacity and give priority to opening it up to the clean power bases in the Northwest and Northeast.”
Wu Qingsong nodded heavily, said nothing more, and took a big gulp of tea.
"Ahem, since Xuanwu batteries are a commodity, cooperation must be based on business rules. I want to state here that we will definitely protect Galaxy Technology's business interests."
"The reason we came here today is exactly what Manager Wu said. Energy storage and electricity are closely linked. With your company's Xuanwu batteries, to be honest, it has greatly promoted the development of clean electricity in China. Originally, this electricity was called 'garbage electricity' because it could not be supplied stably and fluctuated greatly, so it could not be sold at a good price."
"But with the Xuanwu battery, the situation has changed. We can better explore its commercial value. my country has a vast territory, making it the perfect place to develop clean energy."
“Originally, this cooperation agreement required a public tender, but given the exceptional performance of the Xuanwu Battery developed by Galaxy Technology, we made an exception and skipped this process to proceed with the cooperation.”
"Mr. Wang, please believe that we are seeking cooperation with the utmost sincerity."
With Director Zhou's words, the atmosphere in the meeting room finally eased.
Han Wei finally looked away from the picture book.
Liu Dehai sat in the corner of the sofa without saying another word.
His gold-rimmed glasses reflected light, obscuring his eyes, but the two bulging veins on his fingers betrayed his anger.
However, he wasn't the one who could set the tone in this meeting room; he could only wait for others to bring the pace back on track.
Mr. Sun, who had been silent until now, spoke up at this moment: "Energy storage and consumption and Xuanwu batteries are a natural match. Our platform plans to increase investment in energy storage assets. The reason we approached you is because we need to conduct strict technical and data verification and auditing of the products. We hope Mr. Wang can understand this."
The new energy investment platform of the central state-owned enterprise he represents is the key investor in the energy storage projects of those photovoltaic bases in Northwest China.
It's normal to have this requirement.
Wang Donglai immediately replied confidently, "Of course, there is no problem. We can provide the relevant technical data and information, and after reaching a cooperation agreement, we will also provide complete after-sales service for the product. If any quality issues arise, we will also bear the losses and provide compensation."
The atmosphere of the conversation became more relaxed afterward, since the performance of the Xuanwu battery was evident and it had been tested for over a year, proving its quality was not an issue.
Director Zhou and his entourage rushed over from Beijing, naturally with great sincerity in their cooperation.
Therefore, the cooperation was quite simple.
That afternoon, both parties signed a Memorandum of Understanding on Cooperation in Clean Power Storage Applications in the conference room.
The memorandum of understanding is not complex. Galaxy Energy will provide second-generation Xuanwu battery energy storage solutions for clean power bases in Northwest and Northeast China, with the purchase price negotiated on a tiered basis based on the total installed capacity. Both parties will jointly promote clean energy grid connection and consumption pilot projects, with Galaxy Technology providing supporting technical assistance and operation and maintenance solutions for energy storage. Specific contract terms will be formally finalized at the negotiation meeting. (End of Chapter)