Wind Power Winds up China’s Competitors
Beijing has big plans for wind power as a renewable energy of the future, but China may already have too much of a good thing.
At home, China’s power-transmission infrastructure can’t handle the intermittent electricity supply already being generated from wind. It is estimated that 30% of last year’s wind-power supply went unused.
Despite that bottleneck, Beijing wants more. The government hopes to see 100 gigawatts of wind-power capacity installed in China by 2020, a more than eightfold increase from 2008, making wind the third most important source of power in China behind coal and hydroelectric. Even by next year, the amount of wind-power equipment being made will be twice what the nation can install, according to the central government.
That has implications abroad. Foreign rivals are raising concerns that Chinese producers will export their excess capacity at cheap prices. Wind power was one of the industries cited last week by the European Chamber of Commerce in China as likely to stir trade tensions.
The U.N. has already stopped certifying wind projects in China. From Business Week:
The United Nations has stopped certifying wind-power projects in China as eligible for overseas investment under a carbon-credit program overseen by the international body, a Chinese official said.
The certification was halted because the UN is concerned that low power tariffs set by the state help wind projects qualify, said the official at the National Development and Reform Commission with direct knowledge of the matter. David Abbass, a Bonn-based spokesman for the UN Framework Convention on Climate Change, wasn’t immediately available for comment.
The UN program, known as the Clean Development Mechanism, allows companies to invest in emissions-reductions projects that generate carbon credits in developing nations. Polluting companies can buy the credits to meet emissions-reduction targets set in the 1997 Kyoto Protocol to fight climate change.
In Newsweek, Gary Dirks and David G. Victor look at China’s move towards becoming environmentally responsible:
China is already taking the first crucial step: it is cutting emissions by becoming more energy–efficient. Beijing has forced every province and major city to adopt efficiency targets. The top 1,000 companies have their own goals, and Beijing has created a scheme to help smaller firms do their part. In the past two years, China has pushed its provinces and companies to change faster.
The economic downturn has made it easier to implement these reforms. When the economy was firing on all cylinders, there was no capacity to spare, but in these slack times China has closed some of its oldest (and most inefficient) coal- and oil-fired power plants. At the same time, Beijing shifted away from energy-hungry industries such as steel and concrete to higher-value activities, such as skilled manufacturing, that are more frugal with natural resources.
China is also trying to move away from fossil fuels. Wind turbines are sprouting like weeds, most quickly in the geographical middle and far west. The country sees this construction as a form of development aid to these regions, which have lagged coastal cities like Shanghai in economic growth, but also as a way of nurturing its commercial wind industry. So far, China doesn’t export many wind turbines, but as quality rises, so will -foreign sales.