October 2010

China (cont.)

The wind power capacity is second to Germany although in one of our discussions with the embassy folks it was stated that wind generators are deployed, but not connected to the grid. Apparently, the incentives were structured to install the wind turbines, but not necessarily to connect them. Part of the problem lies in the challenges faced by the State Grid Corporation, a State-Owned-Enterprise (SOE) with characteristic government blasé about expanding the electrical grid to outlying regions where the pinwheels lazily spin.

The goal of the wind power directive are to provide 30GW of capacity, about the same amount as 20 or so dual-reactor nuclear plants. China has about 12 nuclear plants in operation with another 24 under construction, according to the World Nuclear Association (so-called 3rd generation plants--with assistance from Westinghouse in the US). The State Energy Bureau has set a target of 5% nuclear-based energy by 2020 (http://www.world-nuclear.org/info/inf63.html) or 86 GW with another 18 GW under construction. By comparison, the US has about 100 reactors in operation, dating from the 1970s, with about 100GW capacity (author's guesstimate).

China plans to build around 36 Nuclear Power Plants in the next 10 years. At a billion bucks a piece, this represents a huge investment. Still, though, coal remains a primary fuel, as it is in the U.S.

China, too, is weighing in on SmartGrid through the mechanisms of the IEC.

The 2020 goal is to bring low-carbon supplies online to supply 15% of demand, nuclear being one such source and hydro-electric being another key source, with a doubling of hydro capacity by 2020. However, the advisors recognize that environmental issues have created serious problems.

The past 30 years has seen a huge expansion of demand; many issues confront delivery of energy to the expanding urban population as well as the distributed rural population that are not connected to the grid.

The thing about China rhetoric is that it is positive and forward-looking and the dialogue is ideological and sometimes sweeping. Clearly, global reliance on energy is shaping foreign policy. Sometimes, though, it is difficult to sort out the rhetoric from the reality, but the obvious challenges exist in the countryside and through the mind- and rear-numbing trek through Beijing's late afternoon traffic.

END

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