Development of New Energy Sources in China

Tuesday, 19 May 2009 11:46

Realizing that economic growth cannot be built upon the destruction of the natural environment, the Chinese government has decided to give a high priority to renewable energy and nuclear energy development. In 2007, China promulgated a “Mid-Long term Development Plan for Renewable Energy” and a "Mid-Long term Development Plan for Nuclear Energy".

While the general consensus is that alternative energy will account for a greater share of the energy industry going forward, different points can be made about which new energy technology is more attractive. The present article aims to provide an overview and analysis of the strengths and weaknesses of different technologies and discuss the prospects for those technologies in China.

I. Global and Chinese Electric Power Structure

According to statistics from China’s Electricity Council, by the end of 2008, total national network power generation capacity reached 792.53 GW, of which 601.32 GW from fossil fuels/thermal plants, 171.52 GW from hydropower, 9.068 GW from nuclear power, 8.94 GW from wind power and 1.682 GW from other energy sources.

In 2008, power generated using fossil fuels was 2779.3 TWh, 563.3 TWh using hydropower, 68.4 TWh using nuclear energy, 12.8 TWh using wind power and 0.96 TWh using other sources of energy.


Within China's electricity power structure, the proportion of power generated using fossil fuels is higher than the world average; hydropower accounts for a little less than the average and the share of new alternative energy sources is quite markedly lower than the global average.

The Chinese government will promulgate the "Revitalization of New Energy Industrial Planning" this year, which should result in the sharp adjustment of new energy-related indicators. According to some official statements, it is expected that by 2020 China power installed capacity will be 75 GW of nuclear power, 100 GW of wind power, 30 GW of biomass and 10 GW of solar power.

II. Comparison of Different Energy Technologies

1. Costs
The economics involved are the most important factor restricting the industrial development of alternative energy technologies today. Power generation costs relate to multiple factors, so we will examine only a simple estimation below, referring to the average online electricity/power price for different forms of power generation.

The reason hydropower, nuclear power and fossil fuels are called the three pillars of electricity lies mainly in the low costs and steady supply involved with these sources of energy. The cost of hydropower is lower than that of fossil fuels energy, cost of fuel energy is comparable to that of nuclear energy. Wind power and biomass energy cost 40% to 80% more, on average, than fossil fuels power, but can be expected to decline with technological development and the expected decrease of industrialization maturity cost. Solar power has remained expensive due to the cost of raw materials; and the development of the solar power industry is currently entirely dependent on policy support. Some solar manufacturers have claimed however that the cost of solar power could drop to 1RMB/ KWh by 2012 on the back of decreasing silicon material prices and technological improvement.

2. Equipment Working Hours

Installed capacity figures indicate power that can be generated under the ideal conditions of a full load, but the actual indicators for power generated refer to the amount of electricity online. One should also take into consideration the significant disparities in working hours between different types of power generation equipment when talking about contributions to overall power generation. Assuming a full load, the average working hours per type of power generation equipment are as follows:


Nuclear power generation involves the highest number of working hours of all energy sources. Meanwhile, biomass energy and fossil fuels power generation equipment involve the same number of working hours. As for hydropower, wind power and solar power, which are easily impacted by environmental factors (weather conditions), average working hours recorded on their equipment are fewer.

Assuming that overall installed capacity reaches 1,500 GW by 2020, fossil fuels power installed capacity 985 GW, hydropower 300 GW, nuclear energy 75 GW, wind power 100 GW, biomass power 30 GW and solar power 10 GW –taking equipment working hours into account, the quantity of electricity generated should reach 5516 TWh from fossil fuels, 1020 TWh from hydropower, 577.5 TWh from nuclear, 200 TWh from wind power, 168TWh from biomass and 13 TWh from solar power.




3. Environmental Protection
－ Hydropower: The development of hydropower is a controversial issue across the world, as is the case in China. Many experts have concerns with regard to the impact dam construction has on the environment and local eco-system. The Chinese government, however, continues to actively develop hydropower as a low-cost and sustainable source of energy.
－ Nuclear Power: Nuclear power development raises issues such as operational safety and waste disposal. With the progress made in nuclear power technology and greater experience of operational management teams, however, nuclear power plant safety has significantly improved over the years. The waste disposal method that is currently recognized as a safe is for high-level radioactive nuclear to be buried deep in the terrane. China plans to build a permanent nuclear waste repository in Beishan, Gansu Province. The repository is sized to store high-release waste produced all over China for the next 100-200 years, and should hold 10,000 years.
－ Wind Power: Wind power is universally recognized as a clean source of energy. Though there are some negative views whereby wind power generation equipment will kill birds and produce noise pollution, these views do not hold much influence.
－ Biomass: Power generation based on biomass involves using waste and recycled bio-fuels. Theoretically speaking, the production of biomass power generation fuel absorbs a quantity of carbon dioxide equal to that produced during the combustion process, so that biomass power generation is considered a source of clean energy.
－ Solar Power: Solar power is a widely recognized clean source of energy.

4. Grid issues
Given their reliance on natural conditions, hydropower, wind power and solar power generation sites tend to be located at a distance from load centers, which can lead to incomplete grid and high waste issues. Nuclear and biomass energy power generation stations, on the other hand, can be set up close to load centers with a better grid conditions and negligible grid waste.


III. What are China’s issues with each type of energy technology?

According to a 2003 assessment of national water resources, the potential for hydropower installed capacity development in China was as much as 540 GW and among that about 400 GW with economical development value, ranking China first globally in terms of potential hydropower capacity. With the proportion of developed capacity standing at 43% and below the global average, there is still tremendous potential for hydropower capacity in China.

At present, nuclear power installed capacity in China has reached 9,068 MW, representing less than 1.2% of the country’s total installed power generation capacity, and offering still significant development potential compared with the international average. So far, the Chinese Government has approved 8 nuclear projects representing a total of 24 units and installed capacity of 25.4 GW. Construction work has begun on thirteen units with total installed capacity of 13.35 GW, and accounting for 30% of the world’s projects in-progress. Chinese nuclear energy development, however, faces two big issues:
－ One is the lack of uranium, as China is a lean uranium country and in a position to support only a third of its consumable uranium demand in 2020 according to current identified uranium resources.
－ Another is the lack of qualified staff and personnel. According to its current development goals, China should have around 60 nuclear power generating units in operation by 2020. At the same time, more than 30 units will be under construction, which implies that China will need at least 100,000 nuclear power plant construction and management professionals.
Today, the Chinese are reaching out to other countries for cooperation in the area of nuclear energy. Chinese has signed uranium cooperation agreements with Niger and Kazakhstan, and set up international training cooperation programs with France, Korea and the United States.

China is rich in wind power resources. The country's current proven wind energy resources have reached 300 GW on the mainland, and a total of around 1,000 GW when combined with resources available offshore. The quality of Chinese wind power equipment remains inferior to that of foreign equipment, the wind power owners like to use foreign wind power equipments at the best wind field.

The development of biomass energy power generation in China has until now encountered a number of difficulties, such as issues with raw materials collection and the relatively high cost of raw materials. At the same time, power generation using municipal solid waste has been growing steadily, and in 2008, expanding waste-to-energy production reached 239 MW, against total waste-to-energy installed capacity of 1,230 MW.

While China tops world rankings in terms of solar power manufacturing capability, the country is still only slowly implementing solar power generation –with national installed capacity in 2008 of around 200 MWp only, against additional solar power capacity of 2,826 MWp across the world in 2007. With the decrease in silicon prices, the cost of solar power should reach a reasonable level compared to other sources of renewable energy, and the solar power generation industry should develop faster.

IV. Conclusion

The Chinese government wants to build a healthier energy structure for the country. While fossil fuels and hydropower are expected to remain the dominant sources of energy for some time to come, their share in national power generation should gradually decrease with the emergence of new technologies. Nuclear power delivers electricity steadily and efficiently, and while opposed by some given concerns over NPP safety and waste-fuel disposal, nuclear energy should play an increasingly important role in the Chinese power market. Their renewable and clean characteristics should also give wind power and solar power an expanding share of Chinese electricity supply. However, given the impact of climatic conditions, the generation time and load efficiency of wind and solar power cannot be adjusted and these sources of energy can only be used as a supplement to main power supply sources. At this stage, biomass also cannot be considered as a source of main power supply given fuel limitation issues.

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