China: new strong thrust for renewables in the next five years

However, Zhang is concerned about some disturbing trends. Last year, China’s total energy consumption reached 3.1 billion tons of standard coal equivalent, up 6.3 percent from 2008.

China would put more emphasis on adjusting its energy structure this year with focus on renewable energy and nuclear power, director of China’s National Energy Administration (NEA) said on Tuesday.

Zhang Guobao, also vice-minister of the National Development and Reform Commission and member of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), made the remarks in an exclusive interview with Xinhua before he attends CPPCC’s annual session.

Zhang took wind power as an example. "Compared with wind power reserves of 2.6 billion kilowatts (KW), China’s installed wind power capacity stood at only 22 million KW."

This was in contrast with a previous downward trend when total energy consumption growth declined from 9.5 percent in 2005 to 4 percent in 2008. But last year, China’s economic growth, which stood at 8.7 percent, was the lowest during the past five years.

"It appears that some local governments approved energy-guzzling projects during economic crisis," said Zhang. "So only by fully implementing our energy saving regulations can we realize economic growth with less energy consumption."

"China and the United States have already strengthened cooperation in the regard by launching joint projects and research centers," said Zhang.

US President Barack Obama, in his first State of the Union address, said that "there’s no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products".

China aims at generating 15% of its overall energy consumption from renewable sources by 2020. A government programme to achieve this target has been formulated and will be officially presented, as Zhang Guobao, head of the National Energy Administration told the China Daily newspaper, without revealing the timing.

The programme, said Zhang, aims to meet the commitment that was informally made by China at the Copenhagen summit, with the ultimate goal of reducing the country’s carbon intensity by 40-45% by 2020, from 2005 levels.

To this end, Zhang said that China will particularly commit itself to achieve a significant energy infrastructure in the next five years, mainly regarding wind power, solar energy and hydropower, including substantial investments in research and development of innovative renewable technologies.

Also to be noted that the vice chairman of the Finance and Economic Committee under the National People’s Congress (China’s top political body), Wang Shucheng’s, made simultaneous statements. These were reported by the China Daily newspaper, which is published in English and is considered the "official" voice of the Chinese government abroad.

Wang Shucheng said that the country will make its greatest effort in the field of hydropower since it is the cheapest energy source, as well as the most abundant one in China, where it also has the most mature technologies. He pointed out that in recent years China has undertaken several large hydroelectric projects, due to possible issues regarding the environment and peoples migration.

But in the next 10 years 200,000 MW of hydroelectric are expected to be installed, increasing the total installed capacity from 190,000 MW at the end of 2009 to about 300,000 MW in 2020.

According to official government data, at the end of 2009 renewables accounted for 9.9% of total Chinese energy consumption, an increase of 1.4 percentage points compared to 2008.

"China’s growth in renewables is astounding," said John Doerr, partner at Kleiner Perkins, one of the most prolific and successful venture capital firms in the United States.

As an example, Doerr said, China grew its market share in the solar industry to nearly 50 percent in the fourth quarter of last year from just 2 percent three years earlier. The United States, on the other hand, went from 43 percent to 16 percent in the same period.

China has also pushed ahead fast in developing wind power. It overtook the United States in new installations and in manufacturing of wind turbines last year, nearly doubling its wind generation capacity from 12,100 megawatts in 2008 to 25,100 megawatts at the end of 2009. China still lags behind the United States in total wind generation, but experts say it may grab the No. 1 spot this year.

China is now taking the lead in solar power and hydropower generation and its wind energy installed capacity ranks 3º in the world. China is stepping up the smart grid construction across the country, as Premier Wen Jiabao put it in the work report to the top legislature last week.

China put the smart grid building on a strategic agenda to facilitate the use of renewable energy and reduce the country’s excessive reliance on the high-polluting coal power generation.

Cai Guoxiong, deputy chief engineer of the China Electric Power Research Institute under the State Grid Corporation, said the smart grid has been piloted in big and medium cities since the State Grid kicked off the construction in May 2009.

The smart grid is an intelligent system capable of seamlessly integrating the alternative sources like solar and wind from power suppliers into the electricity network.

Chinese firm to build Nevada wind turbine factory and assembly facility is to be built in Nevada to supply wind farm projects throughout North and South America.

Private equity group US Renewable Energy Group (US-REG) is backing the venture by Chinese firm A-Power Energy Generation Systems, while local real estate firm American Nevada Company is in the frame to identify a suitable site and to develop the facility. The plan is to develop a state-of-the-art 320,000 square foot plant capable of producing 1,100 megawatts of wind turbines each year.

BYD (Build Your Dreams) is a Chinese car company that reportedly plans to build electric cars in Los Angles. BYD gained notoriety in 2008 when Warren Buffet invested $250 million in the company. Assembling cars in the US will create some American jobs, but the majority of jobs will be in China building the batteries and other components.

Chinese automaker BYD Company (SEHK:1211) announced that it has entered into an agreement with Germany’s Daimler AG to develop an electric vehicles, a move aimed at tapping into the huge potentials of China’s growing electric vehicle market.

The BYD F3DM went on sale December 15, 2008 in China. The electric car uses a lithium iron phosphate rechargeable battery that can be recharged to 50 percent.

Under the agreement, the two will establish a new brand of electric vehicles in China, and set up a technology center to develop and test vehicles.

Daimler has expertise in electric vehicle architecture, while BYD is strong in battery technology and electric power driving systems, according to Dieter Zetsche, board chairman of Daimler AG and head of Mercedes-Benz Cars.

China has become the largest auto market in the world. Both its auto sales and output more than doubled to record levels in January from a year earlier by exceeding 1.6 million units, according to the China Association of Automobile Manufacturers.