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Lack of coordination hinders wind power development(2)

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2016-04-14 09:19Global Times Editor: Li Yan

Furthermore, because coal has gotten so cheap lately, coal-fired power plants makes a lot more sense economically, experts said.

"With coal prices near 10-year lows, power companies have showed an interest in building more coal-fired plants," said Qin Haiyan, a wind expert with the China Renewable Energy Society.

"Because of the fat profit margins, power companies can recoup their investment in a coal-fired power plant within five years," Qin said.

The other reason is that local governments have opened their arms to investments in power plants, Qin told the Global Times on Monday.

These investments can significantly boost local GDP, which remains a key gauge of local officials' performance.

Coal-fired power plants also have advocates due to cost issues and the fact that clean coal generation is growing increasingly feasible, said Li Li, director of research at Shanghai-based consulting firm ICIS China.

The CCTV report noted the popularity of coal-fired power plants is strange considering that China's 2005 Renewable Energy Law explicitly stated in its first chapter that renewable sources have priority in the country's power development.

Li said that solving the problem will require coordination across provinces and regions to balance all of the interests involved.

"One aspect that needs greater coordination is conducting a comprehensive study to calculate the economic viability of transporting electricity over long distances," Li told the Global Times on Tuesday.

Wind vs coal

Some experts said some provinces have built too many wind farms. A national climate agenda emphasizing renewable energy sources and policies designed to attract investment have led to overcapacity in the wind power generation industry.

However, wind power expert Qin disagreed. Considering how much power comes from renewable sources in other countries, wind power still has a lot of room to grow in China.

"In Germany, renewable power accounts for 30 percent of total power generation. In Denmark, wind accounts for 40 percent of total power generation. In contrast, wind accounted for only 3.3 percent of total power generation in China in 2015," Qin said.

Qin advocates for wind power over coal-fired power. But lately, the trend seems to be changing.

In the last quarter of 2015, Northwest China's Ningxia Hui Autonomous Region put restrictions on wind farm power generation in an effort to burn more coal for electricity to support the province's struggling coal industry, Qin said, noting the industry accounts for a significant amount of the region's GDP and tax revenues.

Some provinces even cut the price of electricity generated by wind farms or demanded that wind farms pay subsidies to coal-fired power generators.

"Countries like Germany can absorb wind power in their local power grids. China, on the other hand, has to transmit the electricity a great distance from the wind-rich hinterlands to coastal regions," Li said. "China is the first country in the world to do something like this."

Market reforms in the power industry should be advanced because they will benefit the entire society, Qin said.

On March 25, a panel under the China Renewable Energy Society asked local governments in Xinjiang, Gansu as well as Southwest China's Yunnan Province for more transparency and disclosure about the dumping of wind power, Qin said.

Wind power dumping has caused direct economic losses of 53.8 billion yuan ($8.31 billion) from 2010 to 2015, Qin said. In 2015 alone, the loss was 18.3 billion yuan.

"It's not only about wind energy dumping, it's also about the additional burning of coal, which emits carbon dioxide into the atmosphere," he said.

  

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