New Energy Sources: Direction of China’s Energy Industry

From: English Edition of Qiushi Journal Updated: 2011-09-20 11:48
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 The Chinese government views development of the new energy sources and energy conservation and environmental protection industry as an important measure in economic restructuring and improving the pattern of development in order to address the international financial crisis. Developing new energy sources presents great opportunities and represents a historical responsibility for state-owned power enterprises under the central government. 

 I. Developing new energy sources is an essential choice for scientific development.

 New energy sources refer to new ways of using energy sources, such as wind power, solar power and biofuels, and also include new energy sources generated from traditional energy sources through a technical process. The new energy source industry has a number of advantages, such as low resource consumption, high degree of cleanliness, great market potential, strong ability to drive development in other areas and good overall benefits. For these reasons it is a dynamic and strategic developing new industry with great prospects for future development.

 Developing new energy sources represents an opportunity to make strategic breakthroughs that will enable the country to gain an edge in international competition. Developing new energy sources will help expand domestic demand, create employment opportunities and effectively promote economic growth. The output of the Chinese equipment manufacturing industry for new energy sources is currently worth about 200 billion yuan. If the output doubles over the next three years, the industry will stimulate an annual growth in GDP of trillions of yuan. More importantly, developing new energy sources can nurture the development of new and advantageous industries and establish a system for making innovations in low-carbon technology and developing industrial applications for them based on industry in close cooperation with the education system and research organizations, which will lead to the development of new industries based on high science and technology content with good economy of scale that have a strong competitive edge.

 Developing new energy sources is a practical choice for improving the energy and economic structure. The Chinese energy structure is mainly based on coal, with a low proportion of clean energy. The amount of clean and renewable energy used in 2008 totaled 234 million tons of standard coal, accounting for only 8.9% of total energy consumption. Installed hydropower capacity currently accounts for 21.5% of all installed power capacity in China, wind power for 1.5% and nuclear power for 1.1%, and total installed capacity of photovoltaic power generation system is only 150,000 kW. Developing new energy sources will not only improve the structure of energy supply, promote conservation of resources and energy and raise the efficiency of energy conversion, but also promote improvement in China’s industrial structure and promote sustainable national economic development.

 It is essential that we develop new energy sources to ensure energy security and address climate change. The per capita amount of fossil energy resources in China is inadequate. New energy sources, on the other hand, are abundant in supply, widely distributed and renewable, with vast potential for development. China could develop a total hydropower capacity of 540 million kW, the highest in the world. Solar power is extremely abundant, with 2/3 of the country’s land area receiving annual sunlight hours exceeding 2,200. Available wind power resources total about 1 billion kW. Biofuel resources can be converted to replace about 500 million tons of standard coal. The natural conditions in China for developing new energy industries are excellent. Strongly promoting development of new energy industries and energetically working to develop a low-carbon economy and circular economy will help us better balance economic and social development with environmental concerns, as well as contribute to the global effort to reduce greenhouse gases.

 II. State power companies are the main force behind the development of new energy sources.

 Large state power companies are technology intensive enterprises that are responsible for the security of the country’s energy supply and have a mission to promote sustainable economic and social development. They not only have the responsibility and obligation to do most of the work in making innovations in and developing new energy sources, they also have the base and conditions to do so.

 State power companies have the historical mission of developing new energy sources. Non-renewable energy sources used in power generation account for more than 40% of global energy consumption, of which fossil energy resources account for 90%, have an end-use energy conversion rate of only 30% and account for over 40% of global greenhouse gas emission. Therefore, in changing the structure of energy consumption, electricity should be considered most important and has the most potential. China is now going through a stage of accelerated industrialization and urbanization resulting in steady and rapid growth in demand for electricity, meaning vast potential for the development of new energy sources. China has developed a fairly large scale, relatively sound system of industries that use new energy sources to generate electricity. This system is fully capable and has the necessary conditions to make major breakthroughs in key technologies such as 3G nuclear power technology, high-wattage wind power generation technology and solar polysilicon and take the lead in their development.

  December 21, 2009, setting of the containment vessel bottom head of Unit 1 at the Sanmen Nuclear Power Plant goes smoothly. This marks the beginning of the on-site installation of the nuclear-level module for the world’s first AP1000 nuclear generating station as well as the beginning of work on the project to build the housing for the nuclear reactor stack. The Phase I project of the Sanmen Nuclear Power Plant is of great importance for the first state nuclear power plant to be independently built in China. Thanks to this project and others like it, China will be finally able to independently design, build, manage and operate nuclear power plants based on the AP1000 technology (3G advanced pressurized water reactor). As of the end of 2009 China ranks first in the world in terms of installed hydropower capacity, nuclear power capacity under construction, collector area of solar water heater and photovoltaic capacity. China has become the country with the fastest growing sector for new energy sources and renewable energy sources./ Photo supplied by Xinhua

 State power companies have the basic practical conditions for developing new energy sources. China’s installed power-generating capacity rapidly grew from 357 million kW at the end of 2002 to the current 800 million kW, adding an average of more than 70 million kW of capacity per year, a new world record. China’s installed hydropower capacity ranks number one in the world and installed wind power capacity ranks fourth. More than 54 million kW of small thermal power plants have been shut down, resulting in an annual saving of about 60 million tons of raw coal and annual reduction of CO2 emission of over 100 million tons. China’s solar cells have a total generating capacity of 2 million kW, accounting for nearly 30% of the world total. The level of the technology and equipment used in thermal power, hydropower and nuclear power plants has been constantly upgraded, laying a solid foundation for further improvement in the energy industry and sustainable development of electric power. 

 State power companies have the technical advantage to develop new energy sources. The China Guodian Corporation has been taking full advantage of their technical capabilities and large scale while developing new energy sources to strengthen their core competency and boldly take the lead in competing in the area of new energy sources. This has constantly improved the profitability of the enterprises and their ability to ensure sustainable development. As of the end of September 2009, the China Guodian Corporation had developed nearly 8.5 million kW of clean energy in the form of hydropower and wind power, with total installed wind power capacity continuing to rank first in Asia and fifth in the world. Work on power plant projects using clean energy such as nuclear power, biofuels, tidal power and geothermal energy is now proceeding at an accelerated pace. In the field of high technology, we have developed an industrial cluster of new energy based on plasma ignition technology, manufacturing of windpower electricity generation equipment, solar cells and raw material production and have units studying and developing environmentally friendly power generation, and two key provincial-level laboratories and six technology R&D centers under the corporation. The output value and profit of new energy industries are now growing by over 50% a year.

 III. We are taking a multi-faceted approach to development of new energy sources.

 Developing new energy sources means working hard to develop clean-burning coal technology while also devoting a great deal of effort to develop clean, high-quality energy sources such as nuclear power, hydropower and wind power. In particular, we must continue to import technology while also making our own innovations in order to develop a system of new energy industries with Chinese characteristics. 

 We are concentrating on increasing the scale and improving the quality of hydropower plants. China has an abundance of hydropower resources, of which only 24% has been developed, meaning conditions are excellent for large-scale development and use of hydropower. One, we must steadily work on building large hydropower bases. We need to step up efforts to survey key watersheds for hydropower potential and work to develop a plan for development and use of that potential in order to quickly construct a group of large hydropower stations based on scientific argumentation, following a systematic plan and in a way that is sustainable and orderly. Two, we also need to actively work to develop small and medium-size hydropower plants. In areas where hydropower resources are plentiful but situated in remote locations, we need to build small and medium-size hydropower plants that are easily regulated and fully functional to promote gradual development of hydropower plants in different portions of small and medium rivers. Three, we need to develop a mechanism for utilizing and promoting the development of clean hydropower. We are striving to have more small and medium-size hydropower projects registered with the UN to increase the amount the country benefits from carbon emissions trading. At the same time, we must closely monitor the compensation policy for clean energy and strive to increase the profitability of hydropower.

 We are concentrating on developing clean and renewable energy sources such as nuclear power, wind power and solar power. One, we are accelerating development of nuclear power. We will strive to increase the installed nuclear power capacity while fully taking into consideration safety concerns, import, adapt and make our own innovations in 3G nuclear power technology, gradually develop our own system of new nuclear power technologies covered by Chinese intellectual property rights and increase the use of domestically produced key equipment and major materials. Two, we are devoting a great deal of effort to the development of wind power. We are energetically building large 10 million kW and million kW wind power bases, building offshore wind power facilities, paying a great deal of attention to research on wind power facilities on high plateaus and develop a market for small off-grid wind power facilities, taking into consideration resource conditions, grid connection, power transmission and operation and management of facilities. Three, we are energetically developing solar power projects. We are carrying out a “Golden Sunshine” project that involves building solar power demonstration projects, developing user-operated photovoltaic systems and building small off-grid solar power stations to supply power to remote areas currently without electricity supply. Four, we are gradually developing an appropriate number of power stations using renewable energy sources such as biofuels, tidal power and geothermal energy in line with local conditions.

 We must devote a great deal of energy to developing high and new technology, focusing on new energy sources. We are striving to be a leader in developing new energy sources. The key is to concentrate on core technology, lower costs associated with new energy sources and increase the use of new energy sources by relying on advances in technology, and combine efforts to make innovations in technology with industrial development. One, we need to make constant breakthroughs in new energy technology and concentrate first of all on advanced applicable technology. We need to carry out research on cutting-edge technologies such as distributed energy supply systems and hydrogen power and fuel cells in order to develop the new energy industry into first-rate industry with core competency based on innovative technologies. Two, we need to improve the institutions and mechanisms for making innovations in new energy technology and improve the overall level of personnel working in the field of new energy. We need to strengthen the system for making innovations in new energy science and technology based on enterprises and guided by market forces that integrates production, education and research, recruit leading overseas personnel in the fields of high and new technology, carry out R&D work on basic and multiple application technologies and the core technologies for related industries, and strengthen the technical support for the development of the new energy industry. Three, we need to devote a great deal of effort to developing the industrial cluster of new energy. We need to rely on development of electricity generation as the main industry to drive the development of the wind power equipment manufacturing industry, promote development of the solar power industry chain and strengthen and expand high and new technology industries such as power conservation, environmental protection and IT.

 We must develop energy-efficient, environmentally friendly, coal-fired thermal power plants. Because thermal power plants constitute the majority of China’s power generation capacity, we need to focus energy conservation and emission reduction efforts on the clean use of coal. In expanding the application of clean coal electricity generation technology, we must first of all strongly develop large-capacity, high-parameter thermal power generating equipment and co-generation equipment. We need to make good use of relevant state policies for unified allocation and concentrated utilization of capacities from shutting down outmoded power plants and build large plants with a capacity of at least 600,000 kW in coal producing areas, at UHV transmission terminals and in economically developed areas. Two, we need to upgrade energy conservation and environmental protection technology in power plants. About 40% of China’s thermal power facilities do not have desulfurization equipment, so we must retrofit more plants with this technology and increase the use of technology to remove NOx and nitrogen and capture and store CO2. Three, we need to devote a great deal of effort to developing new clean coal power generation technology. We should aim at the leading clean coal technologies of the world, constantly work to make innovations, use a combination of various types of clean burning technology and energy conservation and environmental protection technology, strengthen strategic cooperation in the energy industry, build more model projects for integrated gasification combined cycle power plants, master the core technologies and accelerate their application, and build a group of green, environmentally friendly power plants.

 We need to concentrate on building large, low-carbon, comprehensive coal utilization bases. One, power companies need to actively participate in building coal-power bases, that is, to build power plants in coal producing localities. We need, in light of the project of sending electricity generated in the western region to the eastern region and the UHV development plan to build large capacity power plants near coal pits in the 13 coal-power bases designated by the state as part of the project to integrate coal production and power generation and the project to develop facilities that reduce waste through comprehensive use of resources such as through coal-bed methane power generation. This will create a network of low-carbon energy bases. Two, we need to improve development of coal resources. We need to actively balance exploitation of resources in mining areas with environmental concerns by relying on advances in technology to constantly decrease power consumption and reduce pollution in the process of mining, washing and cleaning, processing and shipping of coal. Three, we need to work out ways to develop coal-based co-production projects. We must expand joint operations between large coal enterprises and power plants, carry out R&D work on application of coal-based co-production and other coal conversion technology and build coal chemistry model projects to increase emission reduction and efficiency in the use of coal resources.

(From Qiushi in Chinese No. 24, 2009)

Note: Author: General Manager of the China Guodian Corporation

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