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Law on renewable energy in pipeline
By Guan Xiaofeng (China Daily)
Updated: 2004-10-21 00:14

China's continued power shortage is pushing the government to take additional actions -- including legislation -- to promote the development of renewable energy.

State entities concerned are drafting a law which will make it compulsory for power grid companies to buy electricity generated by renewable energies, such as water, wind, solar, biomass, geothermal and marine-based power, and all end users will share the costs, according to Li Junfeng, secretary-general of the Chinese Renewable Energy Association.

The draft law is now being circulated among ministries and big State-owned corporations for review and advice.

A revised draft will be submitted to top leaders of the National People's Congress Standing Committee this month for discussion, Li told China Daily.

With approval, the draft law will be submitted to the Standing Committee of the National People's Congress for examination.

The law, which Li hopes will be passed before May next year, has been open to the international community for advice and reference, according to Li.

In June this year, a special conference was held to collect international opinions. It is also accessible on the Internet.

"We have spent a lot of time and energy learning from the successes and failures of our partners in Europe and around the world. We believe this law can start a renewable energy revolution in China," Li said.

China has been slow to develop renewable energies because they are more expensive than conventional energy sources.

For example, it takes 0.35 yuan (four US cents) to generate one KW/hour of electricity from coal while wind-generated electricity costs about 0.50 to 0.60 yuan (six to seven US cents) per KW/hour.

However, sharp increases in energy demands leave China no other choice but to speed up the exploration of renewable energy.

Last year, China's gross energy consumption reached 1.68 billion metric tons of coal equivalent, an increase of 13 per cent over 2002.

"Soaring oil imports, wild fluctuations in international oil prices, the mounting costs of extreme weather events and heightened concern over energy security mean that China's commitment to renewables at this time is crucial," warned Steve Sawyer of Greenpeace International, during a four-day Forum of Wind Energy held earlier this month in Beijing.

On June 30 of this year, the State Council approved a significant energy policy document -- the Outline of China's Medium and Long-term Energy Development Programme (2004-2020).

Making energy conservation a top priority, the programme calls for an adjustment and optimization of China's energy structure, highlighting governmental support for the development of renewable energy.

"The potential to increase renewable energy production in China is vast," Li said. "Renewable energy is playing a growing role in Chinese energy supply and has become a significant future energy source."

According to Li, China's goal to develop renewable energy is to increase its installed renewable energy generating capacity to 60 gigawatts by 2010, about 10 per cent of total power capacity, and 121 gigawatts by 2020, 12 per cent of the total.

Li said China's energy makeup also needs restructuring. China now depends too heavily on coal, which takes up of 67.1 per cent of the total consumption. Oil accounts for 22.7 per cent with an imported amount of 970 million tons.

At present, renewable energy only accounts for 5 to 6 per cent of China's total power capacity.

Environmental deterioration is another impetus to accelerate the exploration of renewable energy.

"The impacts of climate changes on China are truly frightening, demanding urgent action.

More than 60 per cent of Chinese glaciers are anticipated to disappear by 2050, threatening the fresh water supply for more than 250 million Chinese," said Yu Jie, director of Greenpeace's Beijing Office.

The Outline of China's Energy Programme states clearly that the government will "enhance environmental protection and strive to reduce the impact of energy production and consumption on the environment."

China's legislation on renewable energy is certainly not an expedient measure to solve the problem of power shortage but more forward-looking.

"It's true that we now make laws of renewable energy to make up power shortage. But more important, we are now considering a secure and sustainable energy supply after 2020.

By 2020, China's gross energy consumption is estimated to reach 3 billion metric tons of coal equivalent per year.

So we have to reduce dependence on energy imports for it's also a matter of national security," said Xu Dingming, director of the Energy Bureau of the National Development and Reform Commission.

China's journey towards a country of renewable energy has started. From 2003 to 2005, over 20 wind mills of China will invite international bidding.

"The bidding aims to reduce the cost of wind energy and to realize large-scale production," Li said.

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