China cleans up in the renewable energy sector

Updated: 2015-03-20 07:37

By Zhang Chunyan(China Daily Europe)

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Wind power capacity and expertise fuel global cooperation and investment opportunities

Renewable energy resources are expected to play a bigger part in China's energy mix as the world's second largest economy puts efforts into reducing pollution and forging a healthier, more sustainable economy and society. Premier Li Keqiang said in his work report at the annual National People's Congress that China will put great weight behind the development of wind power, photovoltaic power, biomass energy and actively work to develop clean energy.

Among them, wind energy has seen sufficient development in China, given that it has become the third-largest power resource in the country. Already the world's biggest producer of wind power, China plans further massive increases.

 China cleans up in the renewable energy sector

China Longyuan Power Group is building the largest offshore wind power farm in Rudong, Jiangsu province. Photos by Xu Congjun / For China Daily

 China cleans up in the renewable energy sector

Workers are busy with fixing the wind-driven generator in China Longyuan Power Group's offshore wind power farm in Rudong, Jiangsu province.

China is continuing its commitment to the renewable energy sector by investing heavily in wind projects, not only at home but abroad. Such efforts will provide a good basis for cooperation between China and Europe.

More than 23 gigawatts of wind power capacity were installed in China in 2014. That represented 45 percent of the worldwide total, according to the Global Wind Energy Council.

"It's certainly the most dynamic in the global market... The growth last year was enormous, more than anyone expected, including us. I was expecting somewhere between 18-20 gW; it ended with over 23," says GWEC Secretary General Steve Sawyer.

The growth started at nealy zero less than a decade ago, after the introduction of a renewable energy law in early 2006. Since then, wind energy has started to take off, he says.

The GWEC was established in 2005 to provide a credible and representative forum for the wind energy sector at an international level. Its members represent over 1,500 companies, organizations and institutions in more than 70 countries, including manufacturers, developers, component suppliers, research institutes, national wind and renewables associations, electricity providers, and finance and insurance companies.

Sawyer, who is very familiar with Chinese wind energy issues, says the Chinese government has actually done much more than most Western countries.

In order to achieve its ambitious goal, China will need to leverage international expertise in the fields of policy, technology and supply chains.

"My initial involvement in this sector in China was when I was invited to participate in a workshop and consultation on the design of renewable energy law. There is strong cooperation with international experts, Denmark, Germany, and a number of other international programs to help support development in the wind energy sector in China," Sawyer says.

In terms of the technical side, cooperation with Denmark, the United States and Spain can help China to understand how to manage much larger quantities of wind power, which type of management system is best and what kind of technology is required, he says.

While China's economy is slowing down, the development of wind energy has not, Sawyer says, adding that it will continue to accelerate.

Sawyer notes that the focus was initially on quantity rather than quality, but there has been an improvement in quality in the past few years. Some Chinese companies are beginning to make their debut in the international market and are recognized in the marketplace.

In the early years, three-quarters of the wind power installations were machines from Western companies, but that has changed quickly, he says. When the industry started to boom in China, more Chinese companies like Ming Yang Technology Co and Guodian United Power rose to the top.

Beside the improvement in quality and the investment in wind energy in China, Chinese companies are also beginning to invest in wind energy in Europe.

China General Nuclear Power Corporation bought an 80 percent stake in three EDF Energy wind farms in December. It is the Chinese company's first investment in renewable energy in the UK.

EDF will retain a 20 percent stake in the assets and says it will use the receipts to fund further renewable projects in the UK.

EDF also disclosed that it is close to agreeing to a deal with the Chinese power giant to sell it a share of its Hinkley Point C nuclear power station.

The deal shows CGN's commitment to the UK and the strong relationship EDF Group has with them. EDF and CGN have worked together for 30 years and are engaged in ongoing discussions for the UK's first nuclear power station for a generator at Hinkley Point in Somerset.

CGN Europe Energy CEO Lu Wei says the company is happy to be able to implement the first investment of renewable energy in the UK, seeing it as a good beginning for concrete cooperation between the two companies in Europe.

"It is heartening to see China progressing in the same direction by developing its own renewable projects, as well as investing abroad," says Nick Medic, director of offshore renewables at RenewableUK, which is the UK's leading not-for-profit renewable energy trade association.

"China's role in fully industrializing wind power, meaning making it as competitive as other forms of power generation, is undoubtedly crucial. This is not just a reputational issue."

Improving air quality by reducing carbon and emissions has become a priority for China's central government, as pollution continues to take a heavy toll on the country's people, environment and economy. Amid efforts to enforce stricter controls on pollution, the Chinese government had shut down 375 factories by late October.

China's renewable energy generation capacity reached 430 million kilowatts by the end of 2014, accounting for 32 percent of the country's total power capacity, says Shi Lishan, deputy director-general of the New and Renewable Energy Department of the National Energy Administration.

Medic says: "EU countries have committed to obtaining 20 percent of the EU's energy from renewable sources by 2020. This is followed by further plans for 2030 and beyond. For instance, the UK has pioneering legislation in place, the Climate Change Act 2008, mandating that 80 percent of the country's energy should come from renewable sources by 2050."

What this means is that significant infrastructure and investment will be needed over the coming decades to see this transition through and it will be one of the most significant projects of the century.

"There is a wider global relevance to developing renewable energy, particularly for leading industrial nations. Technology and project development across multiple markets is already bringing forward very useful synergies," Medic says.

China's government aims to see wind power capacity increase to 150 gW by the end of 2017, part of a broad effort to meet at least 15 percent of overall energy output from renewable resources by 2020.

Medic explains: "Wind power has a decisive role to play in the energy economy of every industrialized nation in at least three ways: it promotes energy security, by reducing reliance on imported fuels, whether now or in the future. It reduces harmful emissions, thus improving air quality and reducing the threat of dangerous climate change. Finally, it is a sector that generates employment and business growth."

"This is why it is so encouraging to see the ambitious plans China has for wind energy. It is already a country with the most wind capacity installed, and it could soon reach the important milestone of 100 gW of operational wind farms," Medic says.

One highlight of the wind energy collaboration between China and Europe lies in the offshore wind area.

China has an offshore wind development target of 5 gW by 2015 and 30 gW by 2030. By 2013, the cumulative offshore installed capacity in China was 428.6 megawatts, which placed it in the fifth spot behind the UK, Denmark, Belgium and Germany.

UK Energy and Climate Change Secretary Edward Davey and Wu XinXiong, head of China's National Energy Administration, signed a memorandum of understanding on offshore wind power in September 2013, the first of its kind that China has signed with another country.

Both countries have agreed to cooperate more closely in their policy development, technology transfer and personnel training, and to increase access to markets in the UK, China, and other countries.

Existing bilateral cooperation on climate change and energy includes extensive joint work supporting the development of carbon markets in China; working in support of China's low-carbon pilot cities on policy development, standards and capacity building; joint energy research in cutting-edge renewable energy technologies; and UK-supported work to help China and other developing countries to adapt to the impact of climate change.

The memorandum is expected to remove the technological and market barriers for both countries to accelerate wind power development and unleash significant investment potential for industries.

Davey says: "We have ambitious plans for the future. Together with China, which plans to develop 30 gW of offshore wind by 2020, we want to make offshore wind a competitive, low-carbon energy choice. Our strengthened cooperation will bring significant commercial and environmental benefits for both countries."

Despite the obvious differences in geography, there is a striking similarity between the two countries, Medic says, adding that in both China and the UK a significant number of major urban centers and heavy energy users are close to the coast.

"Hence, offshore wind energy fulfils an important role in opening a new energy frontier, close to areas of high energy use, but without many of the societal challenges in developing energy infrastructure," Medic says.

Offshore wind is now a real and growing part of the UK's energy supply. The country currently has more than 1,000 turbines, with a combined capacity of about 3.6 gW, and the largest development pipeline in the world.

"In effect, offshore wind energy is the most promising energy source for both countries, particularly as there is another similarity. Both the UK and China have vast marine areas of shallow seas, which are particularly suited for this technology," Medic says.

The signing of the memorandum also will help facilitate Chinese investors' access to UK offshore wind projects.

Medic says: "China's role here will again be crucial in demonstrating how this technology can be fully industrialized, meaning being rolled out at speed and at scale, enabling the necessary cost reductions that would make it competitive with other forms of generation."

When it comes to the challenges and difficulties in China's wind energy development, Sawyer says that the most important thing is quality control, certification and regulation.

"In China and many other countries, you get the regulation on the books and you need to get it enforced."

Another difficulty is how to increase the electricity generated by China's wind energy capacity in the future.

Sawyer believes Western companies will be very happy if there is much more access to the Chinese market.

Ning Hui contributed to this story.

China cleans up in the renewable energy sector

(China Daily European Weekly 03/20/2015 page16)