China Clean Energy Syndicate [02-08 Mar. 2020]

It appeared to be a relatively beige week last week, despite many updates from China’s renewable and cleantech market. Please scroll down for the full updates of 14 news stories.

And here are some of the highlights:

  • WIND: Guangdong province will be building 19 offshore projects (>8GW) this year; Vestas achieved the first success in selling its 3.3MW turbine to China
  • HYDROGEN: separately, three energy players of different background SPIC, Sungrow, and Oriental Energy all announced ambitious hydrogen investment plans 
  • SOLAR: Jinko Solar tumbled due to negative report; A small move of Tesla hint the firm’s intention to soon enter into China’s solar market
  • GRID: China revamped six UHV transmission grid construction, which will help renewable–but how would Beijing choose between electricity market reform and infrastructure investment remains to be seen 

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Wind

Chinese Wind Companies Secured 40 Overseas Deals Last Year, of Total Contract Value $4.15 bn

Chinese companies secured 109 new energy power projects in 2019, of which 40 were wind power projects. The total contract value of wind projects achieved by the Chinese firms were $4.15 bn, increased by 23.6% compared to the previous year.

Pakistan remains the primary market for Chinese wind enterprises overseas. Pakistan signed 13 wind power projects with an installed capacity around 750MW and a contract value of $960 mn, accounting for 17.6% of the total contracted power projects in Pakistan ($5.46 bn) and 23.1% of the overseas wind power contracted projects.

Other critical wind power markets for the Chinese developers include Poland, Ukraine and Kazakhstan.

Guangdong Province to Construct 19 Offshore Wind Projects in 2020: of 8078 MW Capacity in Total

Guangdong released that 2020 provincial government work plan last week which listed 1230 infrastructure projects of ¥5.9 tn investment as government priorities this year. Notably, 19 offshore wind projects are listed, totalling 8078MW.

16 projects have already begun construction and aim to complete by 2021:

  1. Yangjiang Shapa 300MW: by China Three Gorges (CTG)
  2. Yangjiang Nangpeng Island 300MW: by CECEP
  3. Yangjiang Nanpeng Island 400MW: by China General Nuclear (CGN)
  4. Yangjiang Shapa 300MW : by Yuedian (Guangdong Energy Corp)
  5. Zhuhai Jinwan 300MW: Yuedian
  6. Huizhou Harbor 450MW Phase-1: CGN
  7. Shanwei Houhu 500MW: CGN
  8. Zhanjiang Wailuo 200MW Phase-2 : Yuedian
  9. Jieyang & Jinghai 150MW: State Power Investment Corp (SPIC)
  10. Nanao Leimen 400MW Phase-1 : China Datang
  11. Yangxi Shapa 400MW Phase-2 : CTG
  12. Zhanjiang Xuwen 600MW: CTH
  13. Jiazi 900MW Phase-1, 2 : CGN
  14. Shenquan 750MW Phase-1, 2 : SPIC
  15. Zhuhai Guishan 780MW Phase-2 : China Southern Power Grid (CSG) Consortium
  16. Yangjiag Shapa Demonstration 300MW: Ming Yang Smart Energy (MYSE)

Three projects will kick off construction this year, also hoping to complete by 2021

  1. Zhanjiang Xinliao 200MW: Yuedian
  2. Huizhou Harbor 600MW Phase-2 : CGN
  3. Yangxi Shapa 400MW (Phase-3), 300MW (Phase-4), 500MW (Phase-5): CTG

Vestas Wins First Order for V155-3.3MW Turbine in China

Danish wind turbine manufacturer Vestas has won a first order in China for its V155-3.3MW machine, and will supply 61 of the low-wind machines for two projects with a combined capacity of 201MW. The projects come from the country’s ongoing auction scheme, and include the supply of towers, as well as a five-year service contract.

“This order comes less than six months after the introduction of V155-3.3 MW [in China], demonstrating the optimal market fit of the product in China’s low wind market,” said Vestas China president Thomas Keller, adding that the turbine had been designed specifically to meet requirements in the Chinese market.

Sinoma Expects 10GW Blade Manufacturing Capacity This Year

Chinese blade supplier Sinoma said to expect 10GW blade manufacturing capacity this year. It was a solid seven days last week in terms of progress in China’s wind, solar, fuel cell, and electric cell sectors.

The capacity increase is due to two factors:

  1. the increase of “blade capacity”: the portion of longer blades (for larger capacity turbine) have increased. By the end of 2019, the average blade capacity has exceeded 2.5MW
  2. the increase of sales: the recent installation dash has spiked up demand for blades. The firm sold 3.2GW in 2019H1, up more than 100% YoY. It expects to see further growth of blade sales this year

China's First Auction-Based Offshore Wind Project Kicked Off Turbine Tender

Shanghai has officially launched a turbine bidding for Fengxian offshore wind power project–the first competitive pricing based offshore project in the country. The site is located North of Hangzhou Bay and will host an array of turbines totalling 200 MW capacity.

Last year, the project kicked off allocation for developers, in which a record low bidding price $88/MWh occurred. But the final winner for the project was not the lowest bidder but a consortium led by the SPIC wind subsidy.

The turbine tender asked for machines larger than 6MW and set a price ceiling of ¥7100/KW.

Solar

Jinkosolar Called 'Worthless' in Short-Seller Report

JinkoSolar tumbles following a negative report from Bonitas Research that alleges the company “exists for the sole purpose of developing PRC assets with JKS’ cash that were disposed to Chairman Li at a significant discount to market.”

Tesla's Ambition to Go Big in China's Solar Rooftop May Face Price Disadvantages

Tesla started to recruit solar project development and business development managers for “commercial and residential demand-side” in China, the firm’s official recruitment wechat platform shows. Both job positions will be based on Linggang of Shanghai, where Tesla’s factory is located. The move confirms Tesla’s revelation earlier to develop rooftop solar business in China, market commentators believe. 

Tesla’s chief executive Elon Musk revealed in Twitter this Feb that the firm will speed up its solar business in the bay area of Los Angeles this year and soon to enter the Chinese market. Tesla stepped into PV business since 2016 via a $2.6bn purchase of California-based SolarCity. 

Tesla solar services include Solar Roof, a power generating system meant to look like regular roof tiles, and Powerwall, which can store power generated by solar panels. Tesla is an alternative to ordinary tiles for photovoltaic tiles which is comparatively expensive in China. In the case of usual household prices of only about ¥4/watt, the domestic price of Tesla’s photovoltaic tiles may reach more than ¥20/watt.

Shenhua (China Energy Investment Corp) Teams with a Beijing Tech Firm to Explore Perovskite Solar Cell Technology

Beijing Yaoneng Technology and China Shenhua Solar Technology Corp–a subsidiary of China Energy Investment Corp reached an agreement to jointly push forward CaTiO3 (Perovskite) solar cell technology and industrialization development in China.

Yaoneng was founded in 2017, but the firm claims to begin CaTiO3 R&D since 2013. Notably, Beijing has been listed perovskite solar cell technology as a solar-sector tech priority to develop in the coming decade.

Hydrogen Storage & Fuel Cells

SPIC Committed ¥100bn Investment into Cleantech: Hydrogen is one of the Key Areas

State Power Investment Corp (SPIC) revealed its 2019 investment plan for about 300 new projects, 90% of which are clean energy projects. 

Total capital expenditure of these projects is estimated at ¥104.4 bn. 

Notably, some ¥4.1 bn investment will be spent on advanced nuclear technology, smart energy, and hydrogen industrialization sectors. The total budget for these areas double compared to that of 2019 FY. 

Energy Iceberg Note: compared to its peers (other Chinese power utilities), SPIC stands out more and more for its emphasis on clean energy (nuclear, wind, hydrogen) investment, as well as internal management reform measures. On clean-tech investment, SPIC is developing three flagship renewable projects that are leading globally: the 6GW Ulanqab Wind Power Complex (largest onshore wind park in the world & wind-to-hydrogen demonstration), the Hainan Prefecture hybrid new energy base (3GW solar + battery storage), and the demonstrative Sichuan Ganzi Clean Energy Base 

On hydrogen: besides the Ulanqab wind complex, SPIC has revealed several other wind projects prepared for wind-to-hydrogen applications. SPIC also set up a hydrogen energy subsidiary, which aims to push forward “fuel-cell system technology, hydrogen storage R&D, hydrogen-powered system R&D, testing technology for fuel-cell, and safety-related technology.” It is an important player to look into

Sungrow Secured a Deal to Develop 400MW Power-to-Gas in Jilin

China’s leading PV power company Sungrow reached an agreement with a municipal government in Jilin province to develop a wind-to-hydrogen project in Yushu. The project is dubbed to be the first of this sort in China’s northeastern provinces.

The project will installed 400MW turbines, of which 10GW will be used for hydrogen production through electrolysis, the firm revealed

Sungrow has shown growing commitment in hydrogen, already with three projects previously concluded:

  • in Hefei of Anhui province, it sets to develop a 300MW mounted solar pv projects plus 50MW hydrogen production plant
  • in Changzhi of Shanxi, it has invested a 200MW pv plant, which is soon followed by a second phase 500MW solar-to-hydrogen plant
  • it has teamed with Dalian Institute of Chemical Physics to develop high power PEM electrolytic hydrogen production equipment
  • a hydrogen business unit is set up earlier this year 

Chemical Player Oriental Energy Shift Focus to Hydrogen, Stripping off LPG Business

China’s liquefied petroleum gas (LPG) importer and trader Oriental Energy Corp (Oriental) announced a plan to shift business scope from LPG to hydrogen drastically. Last week the shareholder meeting of the firm has passed the plan to change its business strategy.

The firm plans to sell off its LPG trading business and reinvest into a green chemical project at Maoming ( a city in Guangdong). The cash generated by the asset sales will also be used to expand to hydrogen and PP-based new materials manufacturing sectors.

Energy Iceberg Note: Oriental’s plan is to expand hydrogen production by propane dehydrogenation process (PHD). From this year on, the firm is capable of producing 100,000 ton of hydrogen annually from its PHD plant. Its gas product now has made breakthroughs into Zhangjiagang and Ningbo markets. 

NEA Announced to Kick off Four Energy Research Projects

NEA announced to kick off four research projects on energy revolution and green development, which include a “Research on the Development of the Hydrogen Energy Industry and the Support of Technical Equipment Innovation”.

Energy Iceberg Note: The research will be led by China Energy Investment Corp (CEIC) and participated by 14 energy companies and organizations in China. The list of the players is an clue of the A-class players in China critical for hydrogen technology investment: SDIC, China Academy of Engineering(CAE), SARI (research institute of CAE), China Machinery Industry Federation(CMIF), Tongji University, China National Petroleum Corp (CNPC), China Shipbuilding Industry Corp (CSIC), China Aerospace Science and Technology Corp, GRINM, Saic Motor, Weichai, and two others.

EV & Battery

Toyota Plans New $1.2 Billion EV Plant in Tianjin with FAW

Japanese automaker Toyota plans to build a new electric vehicle plant in the Chinese city of Tianjin with its local partner FAW Group, a document from the local authorities showed. The joint venture between Toyota and FAW plans to invest around ¥8.5bn ($1.22 bn) in the planned car plant in Tianjin. The plant will have manufacturing capacity of 200,000 new energy vehicles a year, the document showed. In China, new energy vehicles include battery-only, plug-in hybrid and fuel-cell vehicles.

Clean Energy Related

China's State Grid Resume Construction of Six Ultra-High Voltage (UHV) Lines Critical to Renewable Consumption
China's State Grid Resume Construction of Six Ultra-High Voltage (UHV) Lines Critical to Renewable Consumptionmp.weixin.qq.com

SGCC has resumed construction of some 2000 projects of ¥100+ bn total value, amid coronavirus outbreak.

Among different projects, the resumption of six UHV transmission lines across Qinghai, Hebei, Shaanxi, and Jiangxi provinces attract attention. These transmission lines would be a decisive factor for the business cases of several mega (>5GW-capacity) wind and solar complexes along their routes. The six lines are:

  1. Qinghai-Henan ±800 UHVDC, which is designed for the consumption of 2GW wind and 3GW solar hybrid project in Hainan prefecture (Qinghai, owned by SPIC)
  2. Shaanxi North-Wuhan ±800 UHVDC, which is to team with 8GW coal-fired power and 6GW renewable in Shaanxi
  3. Zhangbei-Xiong’an 1000KV UHVAC, which will help to promote the consumption of 2.9GW wind projects in Zhangbei, Hebei province
  4. Zhangbei VSC-HVDC network–one the first kind (VSC multi-station network) in the world and a grand project to connect wind, solar, and hydropower capacity in the Hebei region
  5. Inner Mongolia West- Shanxi 1000KV UHVAC
  6. Yazhong-Jiangxi ±800 UHVDC, which will facilitate the consumption of hydropower in Sichuan province

Energy Iceberg Note: Chinese power sector has been long debating over the necessity of UHV construction. While SGCC is the stern supporter of UHV investment, many others stood against the emphasis of infrastructure investment and SGCC’s monopoly role within these projects. Evidently, due to the controversy, UHV investment has been slowing down since 2018. 

Whether Beijing will approve more projects after these six transmission lines remain to be seen, the Coronavirus outbreak may push Beijing to support massive infrastructure investment, again, to boost economic viability. But on the other hand, Beijing is also “hammering” SGCC for its role in the electricity market reform.

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