State Grid Corp of China plans to build mega power carrier in Inner Mongolia

State Grid Corp of China (SGCC), a major power grid operator, plans to build next year an ultra-high volt-age carrier that will transmit electricity generated by wind energy and thermal power plants in Inner Mongolia to Jiangsu Province.

Work on the 1,300-kilometer transmission line is prepared to get approval from the government, Shu Yinbiao, deputy general manager of SGCC told the newspaper.

The use of ultra-high voltage (UHV) technology in this power transmission project would help better utilize the rich coal mining resources and wind energy in Inner Mongolia, Shu was quoted as saying so.

Power transmission lines employing the UHV technology can deliver to 1,000 kilovolt. Compared with conventional lines they can transmit electricity over longer distance and more efficiently, the newspaper said, citing the analysts.

Such advanced technology is sorely needed as electricity generated by many wind farms in Inner Mongolia cannot be connected to the power grid at present due to a lack of power transmission capability, resulting in a large wastage of energy, according to the analysts.

SGCC said earlier it intended to invest 100 billion yuan into the UHV projects over the next three to four years.

China’s first UHV power transmission line linking Changzhi in Shanxi Province to Jingmen in Hubei Province was put into use in January this year. The line had transmitted nearly 8 billion kilowatt-hour by 15, Dec, according to the SGCC.

Leading wind power equipment maker Goldwind Science & Technology Ltd is planning to invest in an Australian wind farm as part of its efforts to expand its turbine technology business overseas.

"We are also looking at markets in the United States, Central Europe and Africa, either by investing in local wind farms or by directly selling our products," Wu Gang, the company chairman, told China Daily in an exclusive interview.

"We expect the overseas markets to account for 20 to 30 percent of our business over the next three to five years," he said.

Goldwind’s current clients are mainly domestic wind power operators. It is also selling products to Pakistan, Turkey and several central Asian countries.

The biggest wind power maker in China recently expanded its global footprint by acquiring a 70 percent stake in an American wind farm in Minnesota this year.

"Some foreign wind farm operators are facing funding problems and we are utilizing these investment opportunities to get new customers and enhance our presence in the US market," said Thomas Yao, a senior public affairs official with the company.

Last year, Goldwind acquired VENSYS, a Germany-based wind-turbine designer, to enhance its technology in wind turbine manufacturing.

Wind farms account for 10 percent of the company’s business and also give it access to overseas markets for its products.

"We are expanding into the upstream and downstream businesses, from turbine blade manufacture to wind farm operation," Wu said.

Goldwind’s revenue has been doubling for nine consecutive years. Its profit for the first three quarters of this year has nearly tripled to 1 billion yuan.

However, Wu said he expects profits to come under pressure next year due to the intense competition in the domestic market.

Overcapacity concerns

China has become the third largest wind power generator in the world with an installed capacity exceeding 16 million kW by June this year. Just 72 percent of the total wind power capacity is connected to the power grid, according to data from the China Electricity Council. The remaining 28 percent is still unexploited.

Industry analysts estimate that China’s installed capacity of wind power equipment can produce 10 million kW annually in the coming years while the production capacity is likely to exceed 20 million kW next year, raising concerns about overcapacity.

Wu shrugged off such concerns and said the so-called "overcapacity" would soon be absorbed as the construction of power networks progress. He added that the current transmission power networks couldn’t cope with the rapid growth in renewable energy.

To speed up network construction, the power market should be open to more investors, Wu said.

"There are more than 70 wind turbine manufacturers in China but the high cost of wind power hampers the large-scale application of wind technology, resulting in an over-supply of wind power equipment," said Zhou Dadi, an expert with Energy Research Institute affiliated with the National Development and Reform Commission.

"The manufacturers should put more efforts into product quality and technological development."

Goldwind said it would consider acquiring small firms if the industry enters a consolidation phase.

"Chinese manufacturers’ low-price advantage is not a long-term strategy when competing with foreign rivals," Zhou said.

With its stated ambition to be among the world’s top five wind power equipment makers by 2013, Goldwind is now focusing more on developing megawatt equipment, including the 3 mW and 5 mW wind turbines.