President Xi’s announcement to halt coal-fired investment overseas might have occupied the headline last week. However, a bigger story is the severe power crunch that occurred again. While the nation eyes on multiplying everything “clean” in the next decade, establishing an effective market mechanism for clean investment remains a critical challenge.
Our picks of the critical updates last week:
- Net-Zero: China announced to ban new coal-fired power investments overseas.
- Renewables: An industry report estimates that China would add 400 GW of large-scale centralized wind and photovoltaic complexes.
- Hydrogen: CNPC pledged to develop blue hydrogen and CCUS projects covering seven regions in the country. China’s first liquid hydrogen system and first pink hydrogen power-to-gas project are progressing as planned.
Please scroll down to check out the nine updates that we considered noteworthy last week.
For those who do not know us: China Clean Energy Syndicate is a weekly news update project developed by Energy Iceberg. We also offer free analysis on China’s renewable, electricity market, hydrogen, and energy storage. The analytical articles are shared every fortnight. Check out our website to subscribe:
Net Zero Headlines
Chinese President Xi Jinping announced through a pre-recorded video address to the United Nations General Assembly on 21 September that China “will not build new coal-fired power plants abroad” while at the same time increasing its support for developing countries to pursue green and low-carbon development.
It is unclear how China will approach the overseas coal power projects that are already planned or under construction. According to data collected by the Global Development Policy Centre, in mid-2019, 13.5GW of overseas coal power capacity with Chinese involvement had already been planned, and 20GW was being built. The pandemic might have disrupted some of that.
In its recent report, brokerage firm China Industrial Securities pointed out that China will ramp up mega wind and solar power complex construction in the next decade. The firm estimated some 400GW capacity would be added from these centralized mounted wind & solar complexes.
Out of the 400GW, over 100GW is expected to be installed and connected to the grid within the 14th Five-Year Plan (14th FYP, 2021-2025) period.
According to the recent update of flange maker Iraete Energy Equipment, China’s third floating offshore wind project developed by CSSC Haizhuang Wind Power is progressing quietly. Guangzhou Wenchong Shipyard Heavy Industry–the floater builder–has ordered the floating turbine flange for the project in Zhanjiang, Guangdong province. The shipment has been completed and will be embarked in the Zhanjiang Floating Wind Demo Project of CSSC Haizhuang Wind Power.
Separately, a floating turbine prototype developed by Mingyang has been completed this May and will be installed in China Three Gorges’ 400 MW Yangxi Shapa III offshore wind farm. Both floating projects embark on semi-submersible floating technology.
Hydrogen & Fuel Cells
China’s first domestically developed hydrogen liquefying system with a high daily output of liquefied gas had been successfully launched, with a test production completed, China’s state-owned media confirmed last week. The equipment sets to produce liquid fuel for rockets eventually.
The system has been operating for an accumulated 35 hours and produced 35.55 cubic meters of liquefied hydrogen.
Energy Iceberg’s Note: as we mentioned in the previous Clean Energy Syndicate, the system is developed by the 101 Institute of China Aerospace Science and Technology Corp. The liquefier has made the first LH2 production with 97.4% parahydrogen content. The firm said that the equipment is of 90% local contents including the helium expander, the controlling system, air compressor, and orthohydrogen-parahydrogen conversion equipment.
China National Petroleum Corp (CNPC), the largest national oil company in China, recently revealed that the firm’s hydrogen production capacity had exceeded 2.6+ million tons per year.
In a speech last week, the top executive of CNPC revealed an ambitious “Blue Hydrogen” development plan to combined the firm’s industry by-product gas recovery and CCUS.
20 hydrogen purification (PSA) projects will be built according to the plan. These projects are located in 7 regions which are Bohai Rim, Shaanxi-Gansu-Ningxia, southern and southwestern China, Xinjiang, Heilongjiang, and Jilin.
Energy Iceberg’s Note: CNPC is the second major energy company in China committed to blue hydrogen–two months ago, solar giant GCL-Poly revealed a strategy to invest both in blue and green hydrogen. The firm is also the second NOC with a CCUS strategy. Previously, CNPC’s peer CNOOC unveils the country’s first offshore CCS project.
Delong Holdings, New Tianjin Steel Group and Air Liquide (China) signed a strategic cooperation agreement on carbon capture projects in metallurgical production based on H2 and steel industries.
The trio will cooperate on low-carbon steelmaking and the development of the metallurgical industry based on H2.
A technology alliance on nuclear power-to-gas was recently established at Tsinghua University to promote high-temperature gas-cooled (HTGR) hydrogen production technology.
The alliance was initiated and established by five parties including Tsinghua University, China National Nuclear Corporation, China Huaneng Group, China Baowu Steel Group, and China CITIC Group.
Energy Iceberg’s Note: Baowu and CNNC have concluded an agreement previously to develop the first pink hydrogen integrating metallurgy project in China.
The world’s first advanced compressed air energy storage power station based on salt cavern compressed air storage facilities in Feicheng, Shandong Province has made important progress.
Technologically supported by the Institute of Engineering Thermophysics, Chinese Academy of Sciences, the first-phase 10-MW demo power station of the project has successfully passed the test of power generation and grid connection, and was officially put in operation. That being said, the world’s first advanced compressed air energy storage power station has entered a state of formal commercial operation.
China Power Crunch Spreads, Shutting Factories and Dimming Growth Outlook
Widening power shortages in China have halted production at numerous factories including many supplying Apple and Tesla, while some shops in the northeast operated by candlelight and malls shut early as the economic toll of the squeeze mounted.
Three units of China’s State Grid Corp. merged with China XD Group last week to form an electrical equipment giant with combined assets of ¥100+ b. The State-owned Assets Supervision and Administration Commission holds 66.6667% of the new electrical equipment company, while China Reform Holdings and China Chengtong Holdings each holds a 16.6667% equity of the new company.
Energy Iceberg’s Note: the merger suggests that the electricity reform on the grid companies continue. It marks a further decoupling of grid operators’ “associate assets” from the main business–in this case the electrical equipment manufacturing companies from the grid operating business. The reform is certainly a positive news in terms of building a fair electricity market.