ASIA ENERGY FORUM 2009
The first Asia Energy Forum took place on 7th and 8th of August, 2009, in Guangzhou capital of South China's Guangdong Province. The forum has focused on “Energy Revolution: Growth, Green and Cooperation". It aims to establish a long lasting communication mecanism for sustainable energy development in Asia.
The event has emphasised efforts in assessing the international energy situation and to find ways for Asian countries to develop their own low-carbon economies.
THE FORUM
The Asia Energy Forum was chaired by Son Excellence WU Jianmin, Vice Chairman of China Institute of Strategy and Management (CISM). He served for China to the European Community in Brussels in the early 90’s after 5 years spent at the Head Quarter of the United Nations in New York and had also served as China’s Ambassador to France from 1998 to 2003.
Among the speakers were the senior economists, CHENG Siwei, Former Vice Chairman of the National people’s congress and XIA Bin, Director of Financial Research Institute, development Research Center of the State Council.
On the NDRC side, DAI Yande provided contribution to understand the direction China is taking in term of energy efficiency and lower carbon consumption.
The large electricity producers were also very well represented with Li Xiaolin, CEO of CPI, the 1st China electricity production Group and HE Yu, General Manager of CGNPC, the large Nuclear Electric Power Utility Group headquartered in Guangdong.
Among the foreign contributors were Angelo Thomas Reyes, Minister of Energy of the Philippines, Jonathan Woetzel, Director of Mc Kinsey China and one of the participants of the US-China energy strategic dialogue, Emile Malet, Chief representative of the world sustainable development forum and Cecilia Van Der Weijden, jurist of International Trading of CMS Derks Star Busemann.
THE NEW ENERGY DEVELOPMENT PLAN
At the moment, coal is providing 70% of China primary energy needs and 82% of the electricity production which has grown at a double digit rate during the last 7 years, leading to arduous negotiations with the coal suppliers. Indeed, the long term supply agreements, negotiated at a set price had to be supplemented by coal purchases on the spot market with prices reaching levels up to 150 $ per ton, when the oil price was at its maximum, to be compared to 20 $ per ton for some long term supply agreements.
The deputy director of China's National Energy Administration, Sun Qin, said China as a major energy producer and consumer will continue to rely on itself for its energy supply. He said the country attaches great importance to the development of clean and renewable energy, and it is expected to unveil its new energy development plan within the year.
Though the exact figures were not communicated before the plan is officially released, it will very likely show impressive increase of green power and low greenhouse gases projects. We are now talking of new targets in the range of new installed capacity of 100,000 MW of wind power by 2020 (up from 30,000 MW in the previous plan) and 80,000 MW nuclear power (against 40,000 MW previously). Considering the fact it takes about 3 years to approve a nuclear project and 4 to 6 years to build it, this means an outstanding construction plan is already underway.
The production cost of wind power is estimated today at 0.55 yuan/KWh (a 0.10 yuan/KWh subsidy would fill the gap with the present ultra supercritical coal plants), while the cost of photovoltaic solar energy his estimated at 1.10 yuan/KWh but experts said that there was still 75% of the developments to be done in this technology.
Along with the new energy mix, improvement of the coal extraction and use as well as the implementation of high efficiency grids are high on the agenda (for the smart grid concept see specific article).
CCS (CO2 capture and storage) was discussed and China and the US were showing a common front with a analysis showing that suitable storage caves were an issue in both countries and that a new technology aiming at converting the CO2 into construction material, including cement and bricks was a more cost effective solution. The European expert were sticking to their solution which would require large pipelines and storage caves.
STIMULUS PACKAGE
When he was told that almost 40 percent of China's four trillion-yuan economic stimulus package had gone to green projects, US Secretary Locke said earlier this year in Beijing to the American Chamber of Commerce and the U.S.-China Business Council, "China has already adopted the most aggressive energy-efficiency program in the entire world, and they are on track to exceed many of their renewable energy adoption goals."
Chinese technologists are eager to develop indigenous methods of reducing greenhouse gases emissions. A research team at the Chinese Academy of Sciences (CAS) Technical Institute of Physics and Chemistry created a giant device that was able to collect and cool coal-bed gas from coal pits.
Before the device was tested in Yangquan and Jincheng, both big coal fields in north China's Shanxi Province, methane, the dominant ingredient in most coal-bed gas combination, was usually not recycled. This would often trigger coal pit explosions, or pollution as it was vented into the air.
The ministry channelled more funds into research on solar, biomass and wind energies. China is a solid sponsor for the International Thermo-nuclear Experimental Reactor (ITER), a pioneer multinational collaboration for finding new and clean energy.
The CAS experiment attracted 10 million yuan in private investments to commercialize methane, a by-product of coal burning that is cleaner than traditional fuels.
Using the huge refrigerator-like device, lead engineer Zhang Wu said, his team froze the combined coal-bed gas under 200 degrees Celsius below zero, and separated methane, oxygen and nitrogen from each other thanks to their different evaporation points.
"The technology not only produces commercialized methane, but also helps reduce greenhouse effect resulting from randomly emitting methane to the air," Zhang said.
As part of its current 5-year plan, China is building a Wide Area Monitoring system (WAMS) and by 2012 plans to have PMU sensors at all generators of 300 MW and above, and all substations of 500 KV and above. All generation and transmission is tightly controlled by the state, so standards and compliance processes are rapid. Requirements to use the same PMUs from the same Chinese manufacturer and stabilizers conforming to the same state specified are strictly adhered to. All communications are via broadband using a private network, so data flows to control centers without significant time delays.
He said that at present China's hydropower, nuclear power, wind power, solar power and bio-energy industries are growing rapidly. The installed capacity of wind power generation has achieved multiple-fold growth for three consecutive years, currently ranking the fourth in the world. Solar electrical energy generation ranks first in the world, and the solar photovoltaic industry has also achieved rapid growth.
As of the first half of 2009, a total of 7,467 small thermal power units had been shut down, and their installed capacity totalled 54.07 million kW, with annual sulfur dioxide emissions reduced by 1.06 million tons and carbon dioxide by 124 million tons.
The same process is on going with the low efficient steel plants whereas large efficient hot and cold rolling mills had continued to be commissioned in companies such as WISCO, BAOGANG, ANBEN or SHOUGANG, in a very fragmented worldwide market (the world leader ArcelorMittal has a 5% market share). This leaves room for further consolidations in the industry.
Michel Aublant
Stratech Consulting Co.,Ltd
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