China – New System Required for Green Funding

New system required to cultivate green funding

Around 90 percent of the funds needed to further develop China’s environmental industry are expected to come from private sources, requiring a new financial system to encourage more funds into the sector. Ma Jun, chief economist at the research bureau of the People’s Bank of China, said this as he revealed the findings of a study… Continue reading China – New System Required for Green Funding

WWF report: China can shift to 80% Renewables by 2050

by Guest Contributor: Chris Conner.
Originally published on World Wildlife Fund.

By embracing conservation measures and renewable energy, China can transition to an 80 percent renewable electric power system by 2050 at far less cost than continuing to rely on coal, according to a new report from World Wildlife Fund (WWF).

As a result, China’s carbon emissions from power generation could be 90 percent less than currently projected levels in 2050 without compromising the reliability of the electric grid or slowing economic growth.

Image Credit: China Solar Cells via Wikimedia Commons.

The future of renewable power is solar power in the distributed energy scenario. China Solar Cells Image Credit: Wikimedia Commons.

The China’s Future Generation report was prepared by the Energy Transition Research Institute (Entri) for WWF and uses robust computer modeling to simulate four scenarios based on today’s proven technology: a Baseline, High Efficiency, High Renewables, and Low-Carbon Mix scenario.

To develop its findings, Entri examined China’s electricity supply and demand on an hour-by-hour basis through 2050 using its advanced China Grid Model forecasting system.

“By fully embracing energy conservation, efficiency and renewables, China has the potential to demonstrate to the world that economic growth is possible while sharply reducing the emissions that drive unhealthy air pollution and climate change,” said WWF’s China Climate and Energy Program Director Lunyan Lu.

“This research shows that with strong political will, China can prosper while eliminating coal from its power mix within the next 30 years.”

In addition to ramping up development of renewable power sources, the world’s most populous and energy-hungry nation will need to simultaneously pursue aggressive energy efficiency initiatives to reduce electricity demand.

These efficiencies, including bold standards for appliances and industrial equipment, can reduce annual power consumption in 2050 by almost half, which would set the gold standard for these products globally and make the shift to a renewables-based power system possible.

“This research allows Chinese leaders to put the questions of technical feasibility aside and economic viability aside. Instead, it is time to focus on how to enact the right policies and establish the right institutions to ensure that China’s citizens and economy are receiving clean, renewable electricity,” said Lu. “The report shows that today’s technology can get China within striking distance of WWF’s vision of a future powered solely by renewable energy.”

The analysis also describes recent Chinese regulatory efforts and challenges to increasing the percentage of renewable electricity in the country, while providing a set of targeted recommendations for Chinese leaders and policy makers on energy efficiency, prioritizing low-carbon electricity supply investments, allowing price changes to reflect the true cost of service, and prioritizing collection and analysis of key power usage data.

“Both China and the United States are at a crossroads where leaders need to choose between a future where healthy communities are powered by clean, renewable energy or a future darkened by air pollution and the dangerous effects of climate change.

This year, as all countries develop new national climate targets in advance of talks in Paris, our leaders need to choose that brighter future.

For Chinese leaders the choice is simple. This report shows that renewables are doable. China can meet bold new targets with today’s technologies while cutting energy costs.” — Lou Leonard, WWF’s US vice president for climate change.

China cuts Electric Vehicle subsidy, Tesla stocks soar

by Nicholas Brown

The Tesla Model S electric vehicle – now available in China.

Tesla Model S

China’s generous electric vehicle subsidy was rumoured for months to face huge cuts — but the Finance Ministry has lowered the subsidy by only half of what was originally planned (a 5% drop in 2014, and a 10% drop in 2015).

Electric Vehicle (EV) manufacturers within and outside of the country had been holding their breath ever since the first hints of a possible subsidy cut trickled out into the press.

However, since the latest announcement electric vehicle manufacturers have been celebrating — including Tesla Motors (TSLA) whose stock values have suddenly surged to a record high of $196 per share. Last year, 35,000 to 60,000 yuan ($5,780 to $9,900 USD) per electric vehicle were paid out in subsidies as the frenetic push continues for cleaner air within China’s smog-choked cities.

China has been on a manufacturing roll in recent years. Even companies that are not based in China choose to manufacture their products in the world’s most dynamic economy. Tesla Motors recently entered the Chinese automotive industry despite legal challenges — and Tesla brass expect the Chinese electric vehicle industry to be as large as, or even larger than that of the U.S.

That doesn’t surprise me, as China has the world’s largest population (1.35 billion in 2012, according to Google), and the world’s largest car market.

Apart from that, Tesla’s stock value could come crashing back down as it did in November of 2013. A 40% decrease occurred in a matter of months, possibly caused by reports of (only) three Tesla Model S fires.

However, every cloud has a silver lining — the fires, along with subsequent NHTSA test results, have showed that Tesla vehicles are quite safe. The NHTSA has since rated the vehicle and Tesla was awarded the highest safety rating ever by the NHTSA in 2013.

Information from CleanTechnica.com show the German’s agree with the U.S. National Highways and Transportation Safety Administration (NHTSA).

Responding to potential concerns, the German Federal Motor Transport Authority, Kraftfahrt-Bundesamt (KBA) decided to investigate the matter and check for manufacturing defects. Tesla complied, providing data and additional information related to the three Tesla fires noted above.

KBA conducted its investigation and came to the same conclusion as Tesla, writing:

“According to the documents, no manufacturer-related defects [herstellerseitiger Mangel] could be found. Therefore, no further measures under the German Product Safety Act [Produktsicherheitsgesetz (ProdSG)] are deemed necessary.”

I would also expect the electric vehicle industry to show strong growth as millions more of China’s citizens begin to enjoy disposable income levels on par with other emerging nations. In the China of 2014, hundreds of millions of people need economical cars today and (literally) millions of others are waiting for the opportunity to buy a luxury car. In some cases, due to the long waiting lists the delivery date for a luxury imported car can take longer than one year in China.

According to the Wall Street Journal, even Rolls-Royce sells more cars in China than they do in most countries, at a cost of hundreds of thousands of U.S. dollars per vehicle. China and the U.S. are the most significant markets (as of January 2014) for Rolls-Royce.

Tesla is due to report their fourth quarter results on February 19.

Source: CNN Money

Editor: John Brian Shannon

China Drops Subsidies, still Smashes Solar Records

by John Brian Shannon

China solar power record-setting installations in 2013, were mostly 'Distributed Energy' installations. (Rooftop solar PV)
In 2013, 2014 and 2015 China ramps up solar PV production/installation to unprecedented levels and drives toward unsubsidized, distributed energy solutions.

China surpasses all of its Renewable Energy targets (twice!)

In July of 2013, it was announced that China planned to add an unprecedented 10 GigaWatts (GW) of solar power per year for each of the next three years, (starting from FY 2013) for a grand total of 30 GW over 3 years.

But by October 2013 China’s solar target had been upped to 12 GW — and now in February 2014, while they are still doing the final counting, China’s total installations might well surpass 14 GW for 2013 — and yet another 14GW is planned for 2014 (for a total of 28 GW in only 2 years).

(Prior to China’s aggressive solar installation programme, Germany held the world record at 7.6 GW in 2011)

“The 2013 figures show the astonishing scale of the Chinese market, now the sleeping dragon has awoken.”

“PV is becoming ever cheaper and simpler to install, and China’s government has been as surprised as European governments by how quickly it can be deployed in response to incentives.” — Jenny Chase, head of solar analysis at Bloomberg New Energy Finance.

Distributed Energy leads the charge

Officials from China’s National Energy Administration (NEA) said that two thirds (8GW) of China’s 2014 target would come from the rapidly growing segment known as ‘Distributed Energy’ — installations comprised of small-scale arrays usually mounted on rooftops — or when not mounted on rooftops, are otherwise situated very close to electricity demand centres.

It is interesting to note that strong Chinese (14GW in 2014) and Japanese (7.2GW in 2014) solar PV demand will account for 40-45 percent of all 2014 global installations and that 2/3rds of that is expected to be small-scale, distributed energy.

Almost every week, new distributed energy sites are being announced in countries around the world. This one, announced in October 2013, is a typical installation at 120 MegaWatts in Zhenjiang, China. Click here to read more on that story.

Distributed energy will become the fastest-growing part of the solar market in China, Japan, Thailand and many other countries in 2014. Further, China continues to scale back on subsidies and incentives as the Chinese government increasingly sees solar PV as a mature industry, running near grid-parity in the country and capable of competing without government intervention.

Subsidies for Solar PV to virtually disappear by 2015

The biggest PV news in 2014 will be sustainable and unsubsidized solar power markets.

“With PV costs falling and traditional energy prices rising, there could be some 700 MW of unsubsidized PV announced worldwide.”

“While government subsidies and incentives have traditionally fueled the early growth and adoption of solar power, the recent scaling-back of these policies has left PV increasingly going solo – the signs are good, though, that the market might well be ready to take flight unassisted in 2014.” — PVmagazine.com

The Chinese ‘Year of the Horse’ will happen at full gallop

All in all, 2014 looks set to become a momentous turning point in the global PV industry, especially as Japan and China ramp up production/installation to unprecedented levels and drive towards unsubsidized, distributed energy solutions — and with no shortage of eager customers.

For very different reasons — Japan replacing it’s lost capacity due to the Fukushima meltdown and their citizens’ subsequent turn away from nuclear and China working towards improving their urban air quality — the future for solar PV and distributed energy in the Asia region looks very bright indeed.

See also:

China Opens A Window of Opportunity 2014-2020

by John Brian Shannon.

Three Decades of GDP Growth

After three full decades of impressive GDP numbers, China’s strong growth looks set to continue until the end of the decade.

Never in history has any country accomplished such staggering GDP growth numbers, modernized its infrastructure, oriented its political structures to accept a minimal degree of capitalism, and carry the demands of 1.35 billion people.

Let’s take a look at China’s 1979-2013 GDP numbers.

China GDP growth 1979-2013. Image courtesy of the IMF.

China is now enjoying stable growth rates. In short, as China’s economy has matured, it has successfully transitioned from a Frontier economy to an Emerging economy — and with plenty of momentum in hand, has settled-in to the long-term task of building a Developed economy.

For those willing to engage with China there is the potential for substantial reward, and as in any emerging economy, an element of risk is associated with investing there. In the case of investment or corporate relocation to China, responsible leaders and individual investors alike, are wise to seek the guidance from experienced professionals as they navigate several cultures and languages and the various levels and departments of a (still) communist government.

Focus on Planning

Fortunately, statist economies like China’s are centrally-planned in five year cycles, and for the most part these five year plans are released, translated, and then published by the media.

For one example of China’s long-range planning, in this case regarding China’s aggressive energy, renewable energy and conservation policies, please see: CHINA – Atmospheric Pollution Prevention Action Plan – State Council on the issuance of air pollution control action plan notification – Guo Fa 2013, No.37 [English Translation]

For a summary of that official document, please see: China’s new Atmospheric Pollution Prevention Action Plan

Addressing the Source

One of China’s most pressing problems is the quality of life for her citizens, the absence of which can affect overall citizen satisfaction and even worker productivity.

The poor air quality in China, which reportedly leads to 410,000 premature worker deaths per year, has been addressed with a huge push towards renewable energy. The Common Language Project (clpmag.org) provides a telling snapshot:

“China faces a number of serious environmental issues caused by overpopulation and rapid industrial growth.

Water pollution and a resulting shortage of drinking water is one such issue, as is air pollution caused by an over-reliance on coal as fuel.

It has been estimated that 410,000 Chinese die as a result of pollution each year.

Deforestation and desertification are also issues and an estimated one-fifth of agricultural land since 1949 has been lost to soil erosion and economic development. The country is also host to the trade of endangered species. The country’s rivers constitute the largest potential source of hydropower in the world.

Since 2007, China has stepped up government efforts to work toward environmental sustainability by holding local officials to national standards, publishing national climate change policies and establishing groups on climate change.” — clpmag.org

Measurable Results

To say China’s leadership has posted an aggressive response to air pollution, water pollution, soil contamination and the follow-on effects on citizen health and the economic costs of widespread pollution is a verifiable understatement.

In only a few years, China has surpassed wind and solar PV leaders Germany and the U.S. in the production and installation of wind turbines and solar panels and increased energy efficiency.

Announced in July of 2013, China’s National Energy Administration told the media that they expected to install 10 GW of solar by year end of 2013, another 10 GW of solar to be installed in year 2014, and yet another 10 GW of solar to be installed in year 2015.

While many nations were installing mere MegaWatts (MW) of solar or wind power in an effort to ‘look green’ — China’s energy officials said that although they had planned to install 10 GW of solar power in 2013, China may have surpassed that target by a full 4 GigaWatts for a grand total of 14 GW of solar installed in year 2013!

It was later announced that 12 GW would be installed in year 2014, and it has been reset once more to 14 GW of solar PV power to be installed in year 2014.

The latest pollution reduction measures announced in China now point to increased spending on energy efficiency and a commitment to the installation of 14 GW of solar panels in 2013 (already done), another 14 GW in year 2014 (in progress) and yet another 14 GW for 2015.

Now that’s an active pollution management file.

Energy news is never boring in China — so stay tuned!