China / Business

China pushes to reduce coal use

By Yang Ziman (China Daily Europe) Updated: 2016-01-31 15:02

Country has committed to reducing CO2 emissions by boosting renewable energy like hydroelectric, wind, solar and nuclear power

Coal is going to make way for new energy in China through reforms in the 13th Five Year Plan (2016-20) as the country battles air pollution, experts say.

"China has to build a strong and efficient alternative energy industry in order to cope with the environmental challenges," says Zhao Yong, associate researcher of the Energy Research Institute of the National Development and Reform Commission. "Using less energy to drive more output is the key solution to China's healthy growth."

The country has committed to reducing carbon dioxide emissions per GDP unit by 60 to 65 percent by 2030 compared with 2005, according to the pledge it submitted last year to the United Nations climate change conference. The consumption of nonfossil energy would count for 20 percent of the primary energy consumption.

To achieve these goals, China plans to add new installed capacity of 100 million kilowatts of nuclear power, 150 million kW of hydroelectric power, 300 million of kW photovoltaic power and 400 million kW of wind power between 2016 and 2030.

However, the high cost of clean energy is the biggest obstacle to China's green power development. Government subsidies are critical to encourage enterprises to engage in the green energy industry, Zhao adds.

Coal-fired power took up 75.2 percent of the total power generation in 2014, according to the National Energy Administration. Nonfossil fuel power, including hydroelectric, wind, nuclear and solar, accounted for just 24.8 percent.

The total power generation in 2014 was 5.4 trillion kW, up 5.09 percent from the end of 2013. Coal-fired power reached 4.2 trillion kW, up 0.17 percent from the same period the previous year. Hydroelectric power contributed the most, at 24.61 percent, to the growth.

"Solar and wind power generation, which is seen as a great hope for China's clean energy endeavor, has remained at the same level in the past two years," says Zhao.

Shi Lishan, deputy director of the new and renewable energy department of the NEA, had been pointing out that supply side reform is key to overall power generation reform. A lot of power generated by new energy is not integrated with the national grid. Worse, since new energy companies rely heavily on subsidies, this installed capacity lies idle if subsidies are canceled.

Pilot programs have been put in place in some places to experiment with integration of new energy with the power grid. For instance, SPIC Mengdong Energy Group Co Ltd, based in the Inner Mongolia autonomous region, is running China's first regional grid to successfully integrate both coal and wind energy.

The company has been working for the past three years in Huolinhe, Inner Mongolia, to power its electrolytic aluminum production.

"The biggest obstacle was that wind power fluctuates greatly depending on the weather," says Liu Jianping, SPIC Mengdong Energy's deputy manager. "If the wind slows, it affects aluminum production."

To resolve the issue, the group adopted a "complementary coal-fired and wind power system", which he says is able to counter-balance any suspension in wind-generated power by adjusting the wattage of coal-fired power and the rate of aluminum production.

Apart from providing encouragement to new-energy production, China is to suspend approvals for any new coal mines for three years. This decision, to eliminate stockpiles and increase new-energy consumption, was taken at a national energy conference held by the central government in December.

Nur Bekri, NEA director, says that, with production overcapacity expected to last for some time, green and low-carbon forms of energy will be the main focus of the new five-year plan.

In some regions, China has introduced a "coal to electricity" reform. Beijing and its neighboring provinces are to replace coal-fired heating systems with electrical systems. All coal-fired boilers in key areas of the city will be removed, according to a plan released in April.

"China's coal consumption is divided largely into two sectors: half for power generation and half for other use," says Lin Boqiang, a professor of energy economy at Xiamen University.

"Currently, 70 percent of the coal-fired power capacity was installed around 2003, which is relatively new given that such installed capacity is usually able to serve for 40 to 50 years. If these installed units run at peak efficiency, they will be able to replace other coal-consuming sectors to a great extent.

"Statistics have shown that, with every 1 percentage point increase in the proportion of electricity in terminal energy consumption, energy intensity, or the ratio between energy consumption and economic output, drops by 4 percent. Therefore, replacing low-efficiency energy with electricity is going to reduce energy consumption," Lin says.

Hot Topics