China Plans US$265 Bln Renewables Spending by 2020
Date: 05-Sep-07
Country: CHINA
Author: Emma Graham-Harrison
Chen Deming, vice-chairman of the National Development and
Reform Commission, added that China aimed to be using
domestically made and designed equipment by then, which could
cut prices for clean energy worldwide.
"We expect the majority of the funds to come from
companies," Chen said when asked about the 2 trillion yuan
forecast.
The cash would help China meet its target to boost the
portion of its energy that comes from renewable sources to 15
percent by 2020, up from 7.5 percent in 2005, as it wrestles
with the legacy of decades of promoting growth at any cost.
Of around 1 trillion yuan slated for spending on pollution
reduction and energy efficiency goals for 2010, 80 percent would
come from companies and just 10 percent from central government
with local authorities and others making up the rest, he added.
Over half the proposed investment will go into large dams,
which environmentalists criticise and some scientists believe
are a significant source of greenhouse gas methane.
But Chen said the benefits of dams outweighed their costs.
"According to our experience, we know large scale dams can
have some environmental impact, but more importantly such
projects make a contribution to our energy (mix) and reducing
atmospheric pollution," he told a news conference at the launch
of a medium and long-term development plan for renewable energy.
The impacts of pollution and shortages of water have
hampered investment and led to social unrest in some areas of
China, while a recent survey showed poor air quality in Hong
Kong is making it hard for companies to attract foreign staff.
Beijing is also coming under increasing international
pressure to curb its emissions of greenhouse gases, expected to
overtake those of the United States this year -- although on a
per capita basis these are far below developed world levels.
Tax and fiscal policies will support the shift to cleaner
energy, together with new rules for companies, which are
expected to come up with most of the cash.
Power firms with over 5 GW of generating capacity have to
get at least 3 percent of energy from renewable sources by 2020,
Chen said, when asked about the role of large companies.
And China's central bank has already added the energy
consumption and pollution records of over 12 million firms to a
nationwide credit database as part of a push for greener growth,
state media said on Tuesday.
BIOMASS, WIND
Biomass energy, particularly for power generation, plays a
large role in the plan, which targets generating capacity of 30
gigawatts by 2020 -- the same as a wind energy goal that
campaigners and even Chen's commission have said is unambitious.
Based on experience in the European Union and China's
actual situation, the country was capable of lifting its wind
power capacity targets to 10 GW by 2010 and 80 GW by 2020, the
NDRC said in a report released in June.
Chen admitted that China already has almost 5 gigawatts of
capacity -- the country's 2010 target -- either built or under
contract.
But he said that the country did not plan to change a
bidding system used to set wind power prices and award
contracts, which critics say is stunting the sector's
development.
He also rejected short-term reforms to China's system of
state-set power prices, saying higher tariffs would encourage
construction of more coal-burning plants, rather than foster
development of renewables.
The country is struggling to stop illegal construction of
new plants, most of them coal-burning, as the national grid
cannot always meet booming demand.
The plan also called for investment in solar, geothermal and
tide energy, but all will make relatively small contributions to
meeting China's ravenous appetite for energy.
(US$1=7.546 Yuan)