China – a greening giant

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As the global installed base of renewable electricity generation capacity continues to expand, China is increasing in importance both as a consumer of green technologies, and as an exporter. The world’s biggest manufacturing nation in solar PV cells is increasingly consuming its own output in this area, and China is also ramping up production of wind turbines fast enough to supply half of a colossal domestic demand – and is established as a major exporter too.

The global renewable generation context

Global installed power generation capacity from new renewable energy sources (excluding large hydro) reached 280 gigawatts (GW) in 2008 – a 16% rise from the 240GW in 2007, according to the 2009 REN21 Renewables Global Status Report. And in 2008 more renewable than conventional power capacity was added in both the EU and US for the first time, with according to a report by New Energy Finance (NEF) for the UN Environmental Programme, over USD140 billion of new money being invested into clean energy projects, compared to USD110 billion in coal and gas plants.

Globally, the main areas of growth in the electricity sector were wind power capacity, which grew by 29% in 2008 to 121GW, or more than double the 59GW of capacity in place at the end of 2005; and grid-connected solar PV, which continued to be the fastest growing power generation technology, with a 70% increase in existing capacity to reach 13 GW. Spain became the PV market leader, with 2.6 GW of new grid-tied installations.

The US has edged into the lead in wind, but the recession has created capitalisation and liquidity problems both in the US and Europe. Windpower Monthly noted in February 2009 that the slow down in the US wind turbine market had "so far cost nearly 650 jobs in rotor blade manufacture and nearly 400 in tower fabrication," while in Europe, Vestas and Siemens had "largely put a stop to recruitment". PV solar has also suffered (see Renewables in Recession?)

However, putting an optimistic spin on it, at least the equipment and material shortages that had been leading to major delays in new projects are now over. As Goldman Sachs commented, "The most important theme in 2009 within the alternative energy space will be a move from severe undersupply to one of at least a more balanced market and potentially serious oversupply."

China makes its presence felt in supply and demand

Oversupply does not yet seem a major issues for renewables in China, which, in both the wind and to a lesser extent solar PV sectors, is expanding rapidly and also beginning to make its presence felt internationally. NEF says that, while investment in renewables in the West fell by nearly 2% last year, there was a 27% rise to USD36.6 billion in developing countries, led by China, which invested USD15.6 billion mostly in wind and biomass. India also invested heavily in wind, with around 10GW installed so far - and its overall clean tech spending rose to USD4.1 billion, in 2008, 12% up on the 2007 level. But it’s China that is now making most of the running across the board.

Colossal wind farm projects

China has a huge wind potential, possibly up to 1 or 2 terawatts in total, including offshore sites, and it is exploiting it quite rapidly. Its total wind power capacity doubled in 2008 and should reach over 10GW by 2010 and possibly 100GW by 2020 - more than three times the 30GW target the government laid down in an energy strategy drawn up just 18 months ago. The expansion has been stimulated in part by a system of government targets, price tariffs and contract auctions and has involved a series of ambitious mega-wind farm projects, including

• a 12GW project in Gansu Province
• 20GW projects in Hami, in Xinjiang Province and in Western Inner Mongolia
• a 30GW project in Eastern Inner Mongolia, and
• 10GW projects in Hebei Province and in Jiangsu Province.

The rapid expansion of wind has helped support a domestic manufacturing base with nearly 70 companies being involved, including 27 state-owned or state-controlled companies; 23 private companies; eight joint venture companies and nine wholly foreign-owned companies. By 2007 Chinese wind turbine manufacturers accounted for more than 50% of all wind turbines installed in China, and by the end of 2009 it has been suggested that annual production capacity will be 10GW, which could help China overtake the US as the world's largest turbine manufacturer. Overall, in terms of wind farm generation capacity, China is expected to surpass Germany, the USA and Spain in 2010. Moreover, it could well become a major exporter of turbines. For example, Windpower Monthly has reported that, following some initial export deals, China might supply 900MW of wind turbines to North America by 2012.

Hydro – large and small – remains the largest renewable generation technology in use for electricity supply in China, generating around 20% of the country’s power, with many thousands of small projects as well as the familiar large ones such as the Three Gorges dam. There is some potential for expansion: indeed the technical potential has been put at 400GW.

Solar PV strongly promoted

While the main policy focus in the new (non hydro) renewables sector has been on wind, the use of PV solar is also now being promoted strongly, with a 300MWpeak national target for 2010. That is, of course, relatively small compared with the 14 GWpeak of PV now installed globally, but the Chinese programme is pushing ahead, and crucially it is shifting from export to domestic deployment. China had become the world’s largest producer of PV cells, with the production rising from 3MW in 2001 to 124MW in 2005 and 1070MW in 2007. Most of this production, roughly 98%, went for export, but given global recession, the emphasis is now more on projects in China.

A USD73 million, 10MW PV solar plant is planned in a desert area in Dunhuang, in the NW Gansu Province, expected to generate 16.37GWh p.a., supported by a feed-in tariff. A 166MW plant is also planned in the SW Yunnan Province and a 1MW unit in a desert area in Western Qinghai Province. There is also a project on a island off Shanghai. And Jiangsu province is planning to have 260MW in place by 2011. A 2008 PV Status Report from the EU DG Joint Research Centre, Institute for Energy, says cumulative PV solar capacity in China could reach 10GWp by 2020, although that was before the global recession set in. But the 300MW 2010 target still seems likely to be reached, and possibly overtaken.

Electricity generation via large-scale focused solar concentrating solar power (CSP) systems is also now being considered, with plans by German company Solar Millennium to build a 50MW, USD162 million pilot CSP plant at Ordos in Mongolia to the north of China, followed by a 1GW project by 2020. Some work has also been done on wave energy, including proposal for testing an Israeli shorline device developed by SDE in Guangzhou province in southern China. Interest has been shown in tidal energy, including the Kobold vertical-axis tidal turbine developed initially in Italy, for possible deployment in the Strait of Jintang, Zhoushan Archipelago, and a possible 300MW tidal lagoon project near the mouth of the Yalu river.

Renewable heat and biomass

More immediately, expansion is continuing in the renewable heat sector, with China now having around 65GW of installed solar thermal power, out of the global total of over 128 GW(th). There are over 40 million solar hot water systems in use, with around 10 per cent of Chinese households relying on the sun to heat their water. Geothermal heat is also quite widely used with around 4GW(th) in place.

Biogas (from animal wastes) and biomass (from farm and city wastes) are obviously major energy options for China - a recent REEEP study suggested that 30% of China’s rural energy demand could be met through bioenergy. China is also aiming to quadruple biofuel output to around 15 billion litres by 2020, or 9% of the nation’s gasoline demand. Whether that is realistic or environmentally viable remains to be seen.

China certainly has its problems - it’s still building large numbers of coal-fired plants to fuel its still rapid economic expansion. But it’s trying hard to expand renewables and reduce energy waste: it has set goals of reducing energy consumption per unit of GDP by 20% by 2010 and of getting 15% of its energy from renewables by 2020 - according to China’s 11th five-year (2006~2010) plan for renewable energy, produced in 2008.

For more on energy developments in China see the China Sustainable Energy Program.