Wind power in China: China has recorded newly added installed wind power capacity of 2.57 GW in the first seven months

Yunnan province has added 17 new wind power farms with a total installed capacity of 1.45GW to its total this year, xinhuanet.com reported September 27 quoting Yunnan Development and Reform Commission executive Zou Song. The additions bring the number of wind farms in the province to 30, capable of generating a combined 2.82GW.

China’s wind power sector gained momentum in recent years due to the government’s supportive policies. Figures showed that the country’s installed wind power capacity reached 12 GW by the end of 2008, ranking the fourth globally trailing the United States, Germany and Spain.

China’s renewable energy installed capacity is predicted to reach 290 GW by 2020, accounting for 17% of the total, China State Grid Corporation announced at the Renewable Energy Development Conference on July 30, 2009.

Moreover, the company estimated that the nation would have a nuclear power installed capacity of 86 GW, a wind power installed capacity of 150 GW, a solar energy installed capacity of 20 GW, and a biomass power installed capacity of 30 GW then.

For grid-connected land-based wind power, feed-in tariff rates are 0.51, 0.54, 0.58 and 0.61 yuan per KW/hour depending on availability of wind energy resources and engineering costs.

China To Develop Seven Mega-Wind Power Complexes Totaling 126 Gigawatts

China is planning to build seven wind power complexes each with capacities of 10-gigawatts (GW) or more. The seven wind complexes have a planned total capacity of 126 GW and will be located in six provinces, including Gansu, Inner Mongolia, Xinjiang, Jilin, Hebei and Jiangsu, according to SHI Pengfei, Director of Wind Energy Specialty Commission of China Renewable Energy Industries Association (CREIA).

Li Jianhua, Communist Party Chief of Jiuquan city, Gansu Province said that the city plans to pour some RMB500 billion into wind energy and equipment manufacturing. By 2010, the city is expected to have 5 million KW of wind power installed capacity and 10 million KW by 2015.

China will begin construction of a 120-billion yuan ($17.6 billion) wind power project in about two weeks in Gansu province as part of a major push to boost renewable energy and cut the nation’s reliance on coal, the official Xinhua news agency reported.

The project, also called "the Three Gorges Dam on the land" could be China’s biggest wind power station, with an installed capacity of 20 GigaWatts (GW) by 2020, the report said, citing Wu Shengxue, deputy head of the Jiuquan Municipal Development and Reform Commission.

The wind project will be constructed in Jiuquan city, which has wind resources that could support wind farms with installed capacity of 40 GW.

Beijing is poised to raise its wind power capacity to 100 GW by 2020, or eight times the current level, as part of a stimulus package aimed at boosting renewable energy.

The threat of climate change is driving China — a top greenhouse gas polluter — to boost the use of renewable energy and restrain greenhouse gas emissions by power plants.

China relies on cheap but dirty coal for 80 percent of its power output. ($1=6.82 yuan).

China builds wind energy observation network

China has established a national network to observe wind power, the China Meteorological Administration (CMA) said Monday.

The newly-operational network consists of 400 anemometer towers, ranging in height from 70 meters to 120 meters, CMA deputy director Jiao Meiyan said.

It was essential to ascertain the wind’s strength in various places before development to harness its power, he said. The location of a power station should be based on exploitable capacity of the wind there.

The CMA started a national survey of wind energy resources in 2007.

Moves to exploit wind power have increased momentum in recent years because of China’s supportive government policies. At the end of 2008, generation of electricity from wind-powered turbines in China reached 12.17 million kilowatts, ranking fourth globally behind the United States, France and Spain.

China plans to build seven wind power stations with a minimum capacity of 10 gigawatts (GW) each by 2020, in moves to boost greatly the use of clean energy.

When completed, the stations will have a combined capacity of approximately 120 GW, while China’s total projected power capacity will be about 1,500 GW.

Chinese Wind Power Industry Has Received the Policy Support from Chinese Government

The support policies will greatly promote the development of Chinese wind power industry. The regulation of the benchmark electricity price will stimulate significantly the enthusiasm of investors of wind power farms and operator electricity network companies.

On July 20th of 2009, China Development and Reform Commission published the Notice on Wind Power on the Pricing Policy. It stipulates that the whole country will be divided into four categories of wind power resource areas according to the situation of wind power resources and engineering construction conditions, and then the corresponding wind power electricity price benchmark will be fixed.

Since August 1st of 2009, the wind power electricity price benchmark in Chinese four resource areas will be 0.51 RMB (0.074 USD) Kw/h, 0.54 RMB (0.079 USD) Kw/h, 0.58 RMB (0.085 USD) Kw/h, and 0.61 RMB (0.089 USD) Kw/h separately. In the future, Chinese newly-constructed continental wind power projects will carry out uniformly the wind power on-grid electricity price benchmark in their own wind power resource areas.

The on-grid electricity price of the maritime wind power will be fixed separately according to the construction process in the future. It also stipulates that the apportion system of wind power charges will be carried out continuously. The part of the on-grid electricity price of wind power that is within the local on-grid electricity price of the fuel coal and desulfurization equipment benchmark is afforded by the local provincial electricity network.

The amount above the benchmark is solved by apportion of the extra electricity price of the renewable energy which is collected by the country. After the adjustment of the on-grid electricity price of the fuel coal and desulfurization equipment benchmark, the part that is afforded by the local electricity network in the on-grid electricity price of wind power will be accordingly adjusted.

At present, the investment for the construction of Chinese wind power farms is generally 8,000 RMB to 1,000 RMB per kilowatt. Based on the 30% of the self-owned capital investment and 1,800 utilization hours of equivalent full capacity, it can be calculated that the electricity cost of the wind power farm with 50,000 kilowatts is 0.43 RMB to 0.53 RMB Kw/h, which is lower than the benchmark electricity price that was issued by China Development and Reform Commission.

If considering the rich wind power resources in Hebei and Inner Mongolia, the utilization hours of equivalent full capacity can reach 2,500 hours and the electricity cost can be reduced to 0.32 RMB. Plus the CDM revenue of about 0.1 RMB per Kw/h in the wind power farm, the profitability of Chinese wind power farms is already on a high level.

For those investors, the benchmark electricity price method is conductive to regulate the mechanisms of market and price. With no vicious competition of low electricity prices, it is beneficial for the investors. In the five sessions of bids for wind power concession in China from 2003 to 2007, the on-grid electricity price has been an important judgment standard.

Though the proportion of the on-grid electricity price has been reduced from the lowest electricity price as the bid price in the first two sessions to only 25% of the bid price in the fourth and fifth sessions, the vicious competitions on the on-grid electricity price among bidders still emerged. After the regulation of the benchmark electricity price this time, the localization schemes of wind power equipment of bidders, technical schemes, financing capacities and financial schemes for projects of bidders will be the determine factors, which is more conductive to the regulation of the market and the healthy development of the wind power industry.

For wind power equipment dealers, based on the fixed revenues of investors, controlling the investment costs will be the key factor to improve the profits. The competition on the price and quality of products among equipment dealers will become fiercer. The equipment investment accounts for 60% of the total investment of the wind power farms. Therefore, the cost control will be mainly focused on the controls of equipment purchase costs and maintenance costs in the future, which will put up higher demands for the quality and price of the products of equipment dealers.

It will also promote the healthy and continuous development of the wind power industry. For equipment dealers, on one hand, the stimulation of the enthusiasm of investors can better promote the increase of the industry and enhance the equipment demands. On the other hand, the fiercer competition will reconstruct the industry and is conductive to the industry in the long term.

Goldwind

Xinjiang Goldwind Science & Technology Company (SZSE: 002202) is a Chinese wind turbine manufacturer based in Urumqi, Xinjiang. The company is the largest turbine manufacturer in China and one of the ten largest in the world.

Goldwind Science & Technology Co., Ltd. specializes in R&D, product development and the manufacturing of large-sized wind turbines.

Goldwind’s high speed of growth is depending on the country’s policy and support, understanding and helping from all fields of the society as well as the open culture of enterprise and the mechanism to take the people as root. Goldwind has enjoyed annual 100% market share growth for the last 8 years consecutively. In 2007, Goldwind Science & Technology Co., Ltd. reported that it has been holding 25.25% market share in China’s wind power market, again ranking top amongst other suppliers.

In 1998, newly established Xinfeng Scientific and Industrial Trade Co., Ltd. of Xinjiang undertook the national key scientific and technology project of the 9th Five-Year-Plan to develop 600kW wind power generating sets.

In 1999, the 600kW wind power generating set was successfully developed. In the year 2000, the company started the tough task of converting itself from an R&D-oriented enterprise to a market-oriented enterprise and trying to achieve a “zero” sales breakthrough.

In 2001, the company changed completely to Goldwind Science & Technology Co., Ltd of Xinjiang. The new company was then authorized to undertake three national scientific and technological projects, namely the research and development of “MW stall-regulated wind power generating set and its key components, which is part of the “863” plan of the State, industrial production technology of 600kW wind power generating sets, and the development of 750kW wind power generator sets, both of which are key scientific and technology projects for the State’s 10th Five-Year-Plan. In 2002, after the establishment and commissioning of the modern large-sized wind power generating set assembly base, Goldwind got ready for an annual manufacturing capacity of 200 sets of 600kW-1MW wind power generators.

In 2003, Goldwind had grown into the largest developer and manufacturer of wind turbine generators in China. In 2005, the first 1.2MW wind power generating set was put into operation in the Dabancheng wind farm.

In 2006, Goldwind Wind Energy GmbH was registered and established in Germany. In February, Goldwind Science & Technology Creation Wind Power Equipment Co., Ltd was established in Beijing. In August, Goldwind won the tender for installation of 33 sets of 1.5MW WTG, a project for the Beijing Olympic Games. In 2006, Goldwind had captured 33% of the China market share, ranking No.1 domestically and the 10th in the world.

In 2007, the first batch of five 1.5MW WTG sets were put into operation in Dabancheng Wind Farm. On December 26th , Goldwind went public at the Shenzhen Stock Exchange.

By the end of Jan.2008, sales orders for Goldwind WTG had accumulated to 3,693 sets with a total capacity to generate 3,452.6 MW of electricity, and projects distributed throughout 18 provinces and regions in China. Goldwind has won market growth performance of over 100% for eight consecutive years.

By December 31, 2008, Goldwind sold 3,527 wind turbines totally, with a total cumulative capacity of 2894.1MW. In 2008, The wind power market maintained rapid growth in China, the company had sufficient orders. The company has not only a large number of orders of 1.5MW units, but 750kW units were still favored by the market. New orders of 1532.25MW were increased, including 750kW units for 804.75MW, and 1.5MW units for 727.50MW; By the end of 2008, the company implemented a total capacity of orders for 1541.25MW, including 750kW units for 170.25MW, and 1.5MW units for 1371MW. In addition, the company achieved a breakthrough in international sales to signed a supply agreement of 6 sets of 750kW units with ENERGOIMPORT company in Cuba and shipped them in December, it achieved a revenue of 33,223,700 RMB.

In addition to the signed orders, the company won the bid of 811.50 MW of the 10,000,000 kW Base Project in Jiuquan, Gansu Province, which has laid a good market foundation for continued development in next two years.

The first wind power project in the world to supply power to marine oil field; The first synchronization of integrated power grid realized between wind power and isolated island power; The first successful implementation in the world of wind power generator unit with global hoisting; The first on-the-sea installation of permanent-magnetic direct-drive generator unit in the world; China’s first marine wind power generator unit and first marine wind power project.

Models Below MW
600kW series wind turbine
750kW series wind turbine

Models Above MW
1500kW direct-drive series wind turbine

R&D Models
2500kW direct-drive wind turbine
3000kW first transmission permanent magnet wind turbine
5000kW series wind turbine

China is planning to increase its 2020 target of installed wind capacity to 100 -150 gigawatts (GW).

"We believe this new pricing structure will result in a fair competitive market giving Western producers greater opportunities to compete in China," McCollister said via e-mail.

Turbine producers who could benefit include Vestas, Gamesa, Nordex and Repower, all of which have established manufacturing facilities in China.

China To Develop Seven Mega-Wind Power Complexes Totaling 126 Gigawatts

China is planning to build seven wind power complexes each with capacities of 10-gigawatts (GW) or more. The seven wind complexes have a planned total capacity of 126 GW and will be located in six provinces, including Gansu, Inner Mongolia, Xinjiang, Jilin, Hebei and Jiangsu, according to SHI Pengfei, Director of Wind Energy Specialty Commission of China Renewable Energy Industries Association (CREIA).

Li Jianhua, Communist Party Chief of Jiuquan city, Gansu Province said that the city plans to pour some RMB500 billion into wind energy and equipment manufacturing. By 2010, the city is expected to have 5 million KW of wind power installed capacity and 10 million KW by 2015.

China will begin construction of a 120-billion yuan ($17.6 billion) wind power project in about two weeks in Gansu province as part of a major push to boost renewable energy and cut the nation’s reliance on coal, the official Xinhua news agency reported.

The project, also called "the Three Gorges Dam on the land" could be China’s biggest wind power station, with an installed capacity of 20 GigaWatts (GW) by 2020, the report said, citing Wu Shengxue, deputy head of the Jiuquan Municipal Development and Reform Commission.

The wind project will be constructed in Jiuquan city, which has wind resources that could support wind farms with installed capacity of 40 GW.

Beijing is poised to raise its wind power capacity to 100 GW by 2020, or eight times the current level, as part of a stimulus package aimed at boosting renewable energy.

Great Leap Forward for China’s Wind Energy

China has recently agreed to invest about $7 billion in new wind projects in Gansu, the arid northwest province with the most abundant wind resource. Nearly two dozen big Chinese power companies have committed to wind projects in Gansu, encouraged by massive low-interest loans from the state banks and various government subsidies.

Over the past few years, China’s wind sector has gotten increasing amounts of attention. In 2007, about 15% of all global wind investments occurred in China. In 2008, about $12 billion was invested in the Chinese wind power market, which by some estimates is now the world’s fastest-growing.

In 2005, China’s wind power capacity was 1.26 gigawatts. By the end of 2008, that figure had jumped to 12.21 GW, or about 1.5% of China’s total nameplate power generation capacity. By the end of 2010, China expects another 4 GW of wind capacity to come online. Since 2007, the government has raised the total wind power capacity target from the original planned 30 GW to 100 GW by 2020. In the government’s “New Energy Resource Stimulus Program” to be in place soon, the price model for the wind power from the government is very favorable to investments in wind. Multiple wind farms with a total capacity of 10 GW or more are to be built in Xinjiang, Gansu, Inner Mongolia, Hebei, Jiangsu, Jilin, and Liaoning provinces.

Moving even faster are the manufacturers – over 70 enterprises have started to make wind turbines and parts, more than double that in the rest of the world. To protect the domestic wind power equipment business, the National Development and Reform Commission (NDRC) has ruled that 70 percent of the equipment in any wind farm must be domestic. Imported equipment is subject to tariffs. This has been labeled by the international news media as “trade protectionism”.

Although currently there is excess electricity capacity and the power industry is losing money, and although wind electricity is more expensive than coal-fired electricity, the wind energy industry in China is still booming. Some companies put up the turbines as soon as a good wind source is located, just to occupy the spot for future development. Many local governments and power enterprises only seek the wind power capacity for political correctness without considering the availability of wind sources and the feasibility of land use. All of these are part and parcel of China’s constant desire to be liked by the rest of the world. If wind is fashionable everywhere else, one can bet it will boom in China.

But as usual there are problems. The national transmission power grid doesn’t have sufficient back up capacity to manage the intermittency of the wind. “Because wind energy is unstable, it is a pollutant and affects the safety of the power grid. The capacity of the transmission power grid is limited, not all of the wind power can be transmitted whenever a wind farm is built,” said Hu Xueha, the deputy chief engineer of China’s Power Grid Research Institute. Many wind farms are being built even though adequate transmission isn’t available. In January 2008 alone, some 300 gigawatt-hours of electricity was wasted due to insufficient transmission capacity. According to recent data from the China Power Union, only 72% (8.94 GW) of China’s total wind power capacity was connected to the grid. The result: a lot of wind turbines have been “sun bathing” — as the Chinese call it.

China’s problems with adequate transmission and back-up generation capacity are not unique. Similar problems are occurring in the US. Thus, while wind appears to be booming, it take some time – maybe a long time – before China’s wind sector becomes a financially sound business.

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