Asia Pulse
 March 12, 2012


China will accelerate the use of new-energy sources such as nuclear energy and put an end to blind expansion in industries such as solar energy and wind power in 2012, Chinese Premier Wen Jiabao says in a government report published on March 5.

China will instead develop nuclear power in 2012, actively develop hydroelectric power, tackle key problems more quickly in the exploration and development of shale gas, and increase the share of new energy and renewable energy in total energy consumption.

The guidance indicates a new trend for new-energy and renewable energy development in China from 2012. Analysts believe that the development of the solar and wind power industries will stabilize while hydropower will have the top priority in renewable energy development in China.

-- Hydropower to contribute two-thirds of renewable energy

According to China's development plan for 2011-2015, China aims to increase the share of renewable energy consumption to 11.4 per cent of total energy consumption in China by the end of 2015.

As solar power and wind power development may slow down by government measures to curb blind expansion, hydropower is expected to play a more important role in fulfilling the renewable energy consumption target and contribute two-thirds to the target.

The National Energy Administration (NEA) plans to add 20 GW of hydropower installed capacity, up 57 per cent year on year, which marks the biggest increase in recent years.

Based on the average cost of 6,870 yuan/kW during 2006-2010, the planned 20 GW hydropower installed capacity will require an investment of 137.4 billion yuan (US$21.7 billion).

Besides these developments, the government report emphasizes accelerating the establishment of mechanisms that promote the use of new-energy sources. It also lays down the need to strengthen overall planning, promote auxiliary projects, strengthen policy guidance, and expand domestic demand. This means China will pay more attention to the utilization of new energy, hence wind power and solar power, which failed to achieve sound utilization, will bid farewell to the era of fast development, said Zhai Ruoyu, former general manager of the China Datang Corp., one of China's five power giants.

-- Share of non-fossil energy use in China drops in 2011

The share of non-fossil energy consumption, including hydropower, nuclear power, wind power and solar power, in total primary energy use in China witnessed a decline of 0.3 percentage point from 8.6 per cent in 2010 to 8.3 per cent in 2011, says Qian Zhimin, deputy director with the NEA.

According to a report from the China Electricity Council on the performance of China's power industry in 2011, the average operating hours of hydropower generating facilities decreased 376 hours to 3,028 hours in 2011 due to severe drought, the lowest level of the past 20 years.

Meanwhile, the operating hours of wind power generating units plunged by 144 hours in 2011 despite an increase of 48.16 per cent in on-grid wind power output.

The operating hours of solar power generating units also declined in spite of the tripling of installed capacity of solar PV power.

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