Hunan CRRC Times Electric Vehicle Co Ltd, a Zhuzhou-based electric vehicle manufacturer, will invest 1.5 billion yuan ($219 million) to set up an electric bus plant in Hebei province.

The investment comes in response to surging demand for such vehicles from Beijing, Tianjin and Hebei province.

The plant will be built in Shijiazhuang, Hebei's capital. Site work will start next year. Upon completion in 2018, it can produce 15,000 electric buses annually, and will serve the province and neighboring cities, including Beijing and Tianjin.

These places have been witnessing environmental concerns related to air pollution and heavy use of cars.

According to a government document on the Beijing-Tianjin-Hebei integration and development program released last year, breakthroughs must be achieved in transportation integration, environmental protection and industrial upgrading in the region during the 13th Five-year Plan period (2016-20).

CRRC TEV's plant in Changsha currently has a production capacity of 5,000 units a year.

Established in 2007, CRRC TEV integrates resources of China Railway Rolling Stock Corp, the country's biggest train manufacturer, for installing railway transportation electric drives and control technology in new energy vehicles.

Liu Yang, deputy general manager of CRRC TEV, said many local governments in the region had already built more charging and service stations to promote the use of electric vehicles. Electric buses could offer a practical solution to help the region cut carbon emissions, Lui said.

CRRC TEV so far has sold 12,000 electric buses to both domestic and overseas markets. It said these buses could help customers cut running costs compared with conventional units by between 20 percent and 50 percent. The company said it had also shipped over 20,000 sets of drive systems and parts to foreign markets.

"Industrial cities in Hebei and Shanxi provinces such as Tangshan, Handan and Changzhi have all placed a large number of orders for electric buses with us to make progress in urban air pollution control," said Liu.

CRRC TEV said it would also establish between seven and 10 sales-and-service branches in Southeast Asia, India, Canada and the Middle East over the next three years, as many countries were keen to adopt electric buses to further cut carbon emissions and save on fuel costs.

It has already exported electric buses and related power systems to Brazil, Canada and Southeast Asian countries over the past three years.

The company has set an export target - to ship up to 20,000 electric buses, all equipped with Internet Plus technology and services, to global markets by 2020.

"Electric buses can reduce noise and vibrations throughout the whole vehicle while in operation, creating a quiet driving environment for owners," said Sun Fuquan, a researcher specializing in electric vehicles at the Chinese Academy of Science and Technology for Development in Beijing.

Sun said such vehicles also greatly cut down the amount of volatile and organic compounds needed during the manufacturing process, thereby minimizing environmental pollution and damage to human health by improving the air quality in the vehicle.