China’s Renewable Energy Plans: Hectic, Not Hectic

The May 12 earthquake in western China’s Sichuan province will have effects that will extend beyond China than Beijing suggests. Sichuan Province holds the key to China’s hydropower generation plans in its renewable energy goals and the area is also a hub for outsourced wind turbine equipment around the world. Both were badly damaged.

This infrastructure will take months or years to repair, but in the meantime, Chinese media report that “the earthquake in dollar terms is minimal and seems unlikely to slow China’s economic growth much.” I am sorry I disagree.

This earthquake cracked dams and roads, but at the same time it blew holes in the myth that an ever-expanding China can accommodate an infinite number of companies wanting to open facilities there. We have been hiding behind a wall of dependence on outsourcing to solve our domestic pollution and economic problems and that great wall is about to collapse.

The Hydroelectric Crutch: The earthquake zone area generated 62 percent of Sichuan province’s total electricity production through hydroelectric dams, of which “396 dams were believed to be badly damaged and many of the power plants Power lines in river systems were damaged and several important reservoirs are being drained to prevent their dams from failing. The seismic safety of these dams is a concern and many of them are expected to need repair and strengthening, “according to the Minister of the Ministry of Resources. Water, Chen Lei.

Even before the earthquake, Beijing had admitted that there are major failures in many of the country’s 87,000 dams. “About 37,000 dams across the country are in a dangerous state,” said Deputy Minister of the Ministry of Water Resources, Jiao Yong, earlier this year, noting that many had been built decades ago.

Two weeks after the earthquake, the Ministry of Water Resources acknowledged that 69 reservoirs and dams were on the brink of collapse, and nearly 3,000 across China had suffered damage.

If the always secretive central government is publishing this kind of information, I can only conclude that the reliable power of that region is no longer assured. This single set of facts surrounding hydroelectric production in western China is one link in a chain that stretches from China to its backyard, and that link has been broken.

Don’t count your renewable energy eggs before they hatch: China has more dams than any other country, about half of the world’s total. And the 11th Five-Year Plan places its hopes on the rapid and massive development of every meter of water that flows in rivers in Yunnan, Sichuan and Gansu provinces in the west to meet the insatiable demand for energy from factories and homes. The Chinese government will now have to reconsider its aggressive dam-building program.

If hydroelectric projects are scrapped, there will be continued permanent power outages across the country. China’s hydropower consumption was around 7% of its total main energy consumed in 2007.

Before the earthquake, the central government thought: ‘Sichuan has the largest possible reserves of hydroelectric resources in the country, estimated at more than 110 gigawatts. Yunnan has several hydroelectric plants under construction on the middle and lower reaches of the Lancang River, with 11 GW and plans for dozens more projects between now and 2016. The abundant hydroelectric resources of Gansu’s Yellow River can provide electricity to neighboring Qinghai provinces. , Shanxi, Sichuan and Ningxia, and their additional potential is great. ‘

No longer.

The China Electricity Council believes that less than 20 percent of the country’s hydroelectric resources are being used. According to the government plan prior to the earthquake, the hydroelectric installed capacity should have reached 125 GW in 2010, which represents 28 percent of the total installed capacity; in 2015 it could have reached 150 GW and by 2020 the goal was 300 GW. These plans are unlikely to go ahead as planned. This will leave China far behind its power generation targets and well below the capacity it needs to attract manufacturing companies to that part of the country.

The slow decline: China’s Go West campaign is designed to attract college graduates and businesses to western parts of the country, thereby stimulating the economy in China’s less prosperous hinterland.

The bait most used by the central government is in the form of the Main Economic and Technological Development Zones, Special Economic Zones and Industrial Zones of the City, which confer duty-free status along with preferential transportation and wage agreements. This is great when there is a continuous power supply, but now in the western region that is anything but safe. China’s State Power Grid announced that Sichuan’s power grid is operating at 76% of pre-earthquake levels. Notice how they conveniently leave out the surrounding provinces, which also suffered damage.

A recent article in the China Daily – “China Expects Power Shortage Amid Growing Demand” – quotes the general office of the State Electricity Regulatory Commission as saying that “Guangdong Province would have a shortage of 5.5GW , Guizhou 1GW and Yunnan 1.5 GW “. Once again, they sidelined the shortages in Sichuan, Gansu, Inner Mongolia, Zhejiang, Jiangsu and Shanxi provinces for a reliable total. This will be the fifth consecutive year of power shortages across the country. Now consider this: the last four years were short with all of the country’s hydropower up and running.

This year, 10 GW of power is likely to be lacking, so keep an eye on the power ratings – “normal shortage”, “severe shortage” and “energy crisis” – to see how your favorite city or industrial area is doing. .

There seems to be a masking of the real numbers. What company would want to establish itself in a country with constant electricity deficits?

Devastation in Beichuan: Combine the electricity shortage with the number of factories that need to be relocated now that fewer companies will want to rebuild on an active fault and the veil begins to lift over what they are hiding. Workers refuse to return to work until government inspectors approve the integrity of the buildings, even though it may take months or years before they reach all businesses. The psychology of danger to the worker and the investor is the X factor that is overlooked in the Chinese equation. Now, how attractive are the Regional Development Zones in western China?

As for those of us who live outside of China, the norm is to outsource heavy industry to China. Even the global renewable energy sector has many of its wind turbines and solar panels produced in China. Unfortunately, Deyang, a city an hour and a half north of Chengdu, had wind turbine operations, including major ones in Europe, Australia, and North America, which carried part of their production at Dong Fang Turbine. Carbon fiber blades, wind towers and ball bearings were also carried out in the same area, supplying parts to Dong Fang. Buildings in the surrounding area from Deyang to Mianyang were severely damaged or crushed.

Business Week sums it up in an article titled “Dongfang Turbine Severely Impacted.” The operations of Dongfang Turbine, China’s largest steam turbine producer and the third largest domestic wind turbine manufacturer, all but disappeared. Dongfang, which produces 30 percent of China’s locally-made turbines, estimates direct losses from the earthquake to reach $ 1 billion. Its parent company, Dongfang Electric Corp., has seen its share price plummet as the steam turbine business accounted for 20% of its operating income in 2007.

Although Chinese media reports suggest that facilities for its wind turbine business were unaffected, sources within the company said that most of its wind business’s senior engineers have passed away and one of its wind component factories turned out. severely damaged.

The Electricity Shortage Earthquake Triangle: Where Does This Leave Us? Peak oil is obvious and can no longer be denied. We as the world need to begin a transition to renewable energy and these circumstances will delay the production of the wind industry in China for a year or two. China’s response to the electricity shortage will be to build more coal-fired power plants. Given that outsourced production is now limited by power failures and shortages, what will our response be?

The electricity shortage earthquake triangle from Kunming in the west to Chongqing in the east and Lanzhou in the north with Chengdu in the center is an incomplete territory from now on. The central government was funneling new business to this exact area because there is so little space along the east coast. That is why there is a massive push to send the economy west. If you’ve been to the coast of China, you’ve seen how densely populated a society can be.

Price is the main reason why we buy Chinese products and have our industries there. However, when something is scarce, it costs more. Electricity is no different. Now there are daily diesel shortages along the east coast, electricity shortages in the west and along the coast. Add in the recently appreciated yuan and China is no longer the business utopia it once was. Until the damage in western China is repaired, increased use of oil, natural gas, and coal will replace hydropower to some extent. This, in turn, creates higher prices in China’s manufacturing sector. You will pay at the check-out counter.

Please understand: the rest of the world is much less dependent on China’s exports than China is dependent on the rest of the world. We need to prepare to take care of ourselves again. As oil prices continue to rise and the global economy slows, I believe we will see a resurgence of light industry returning to our home countries. China’s electrical problems could be partially solved if light industry moved elsewhere and left heavy industries in China. Unemployment will become increasingly fierce in the coming years as our fossil fuel-based economy dwindles.

What a great way to put millions of people to work – bring businesses home. This will remove one link in the chain of dependency on globalization and save energy along the way.