Thursday, May 16, 2013

A new Chinese energy revolution

Small households and firms may now sell solar power to the state grid

A revolution of sorts is in the making in China that could have a big impact on its renewable energy future. Having announced ambitious new targets for wind and solar power capacity, the government is now looking at distributed renewable power generation, where small producers - households, communities, companies - will generate enough to meet their own needs and sell the excess to the state grid for a price - "barefoot" producers who can, with adequate state encouragement, form a formidable supply network that big projects can't easily match.
Last October, the State Grid Corporation of China (SGCC) announced a new policy offering small producers - smaller than six MW - free grid connection and a reasonable price for their excess production. This February the corporation extended the same facility to wind, gas, biomass and geothermal power, as well. Within two months of the announcement of the new policy, China's first distributed solar producer was signed on by SGCC. By April, more than 120 small producers had applied for grid connections, and elated authorities believe their target of 10 GW of distributed solar production won't be difficult to achieve.
One of the first people to take advantage of the new policy was Greenpeace China. It has installed 65 square metres of solar panel on the roof of its Beijing warehouse, which, at full capacity, produces five kWh of electricity per hour, or 25 kWh by day's end. Since an average urban Chinese family consumes about 10 kWh of electricity a day, there would be 15 kWh or more of excess power that can be sold to the grid every day, depending on the extent of solar panel coverage per installation.
Reports say there are some 316 million square metres of south-facing rooftops available across the country. Nobody expects all of these to be decked with solar panels in the coming months or years, but even if half of them are, that's still a lot of electricity. Of course, there are questions of standards to settle and a dedicated pricing mechanism is said to be in the works. Once these are in place, one could expect a booming new industry growing around distributed power. Some state leaders have remarked the direct market for distributed power could be as big as $1.6 trillion, while the indirect market could be several times larger.
Calling for "a revolution in energy production and consumption", China's National Energy Administration has called on provincial governments to establish demonstration zones for distributed solar power. Each of the country's 34 provinces and autonomous regions is expected to install up to 500 MW of demonstration capacity, which itself could, theoretically, create up to 17,000 MW of new solar capacity nationwide.
The immediate purpose behind "barefoot" solar is to ease a severe problem of overcapacity that plagues China's solar panel manufacturing industry as well as to rescue it from over-dependence on the export market. At present, 70 per cent of China's photovoltaic solar modules are sold to Europe and 10 per cent to the US. The bigger purpose, of course, is to expand the role of clean energy and lower threats to the climate from harmful gas emissions.
Presently, about 10 per cent of all energy consumed in China comes from renewable sources, including hydro and nuclear. The target is to raise the share to 16 per cent by 2015, by when renewables are expected to account for 30 per cent of the country's total installed energy capacity. There's only one word that best describes steps that are being taken to make that happen: vigorous. China's hydropower capacity - 200 million KW now, to be 290 million KW by 2015 and 380 million KW by 2020 - is already the world's biggest. Sixteen nuclear power plants are in operation and 27 more are planned. By 2015, installed nuclear power capacity could reach 40 GW.
Last year, China added 15.9 GW of new wind capacity, bringing to 61 GW its total grid-connected wind power and reinstating its place as the largest wind market in the world for the fourth consecutive year. With new wind farms coming up all across the north and offshore farms planned along the coasts in Shandong and Jiangsu, 100 GW of grid-connected wind power by 2015 appears to be an eminently achievable target. As for solar, the new target of 21 GW by 2015 could actually end up in the neighbourhood of 35 MW or more. By that time, installed biomass capacity could hit 13 GW, one-fourth of it coming from household garbage.
But China's energy planning isn't merely confined to developing alternative energy sources. It's deeper than that. A major concern is keeping consumption under control without hurting economic growth. Conserving energy and raising production and transmission efficiency are big priorities. An equally important task is to use new, cleaner technologies and develop new equipment and systems that cut down harmful effects on the environment.