China’s Energy Transition at Odds With Solar Glut, Cheap Power

Chinese spending connected renewable vigor dwarfs its rivals, with implicit $800 cardinal — oregon 4.5% of its GDP — invested past year, according to BloombergNEF. But the state inactive faces important hurdles successful balancing its ambitious clime goals with delivering vigor security, according to experts astatine BNEF’s acme successful Beijing past week.

It’s uncertain whether existing infrastructure tin enactment the surge successful upwind and solar, said Yong Zhao, president of the Energy Research Institute astatine China Huaneng Group, a large energy supplier. “We are successful uncharted territory for the powerfulness transition,” helium said.

The decades-long roar successful cleanable vigor is straining the grid, and cuts successful output of star instrumentality are “too precocious and excessively little” to extremity the industry’s slump this year, said BNEF expert Youru Tan. BNEF present expects a longer trough successful prices alternatively than a V-shaped recovery, helium said, pointing to a nonaccomplishment to destruct smaller, inefficient factories.

China is inactive expected to support installing renewables astatine pace, with yearly additions of astir 300 gigawatts implicit the adjacent decade, said Zhongying Wang, a elder researcher astatine a government-affiliated deliberation tank. That would assistance present implicit 9,000 gigawatts by 2060, President Xi Jinping’s nett zero deadline, which would beryllium six times existent levels.

But specified a accelerated enlargement volition necessitate monolithic concern successful long-distance transmission lines, vigor storage, and flexible peak-loading to marque up for cleanable energy’s intermittency.

“Coal and state stay the astir accessible balancing tools for grid stability,” said Huaneng’s Zhao.

The deluge of star powerfulness has thrust energy prices into antagonistic territory successful regions with liberalized vigor markets, which bodes sick for the economics of further expansion.

Shandong province, location to China’s largest star fleet, has been forced to curtail rooftop projects owed to grid constraints. Its three-year-old spot marketplace saw prices settee beneath zero for implicit 1,000 hours past year, an occurrence that volition go much frequent, said BNEF expert Sisi Tang.