challenges to china’s transition to a low carbon electricity system fritz kahrl, uc berkeley, e3...
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Challenges to China’s Transition to a Low Carbon Electricity System
Fritz Kahrl, UC Berkeley, E3Ding Jianhua, E3Jim Williams, E3
Hu Junfeng, North China Electric Power University
China’s Power Sector is the World’s Largest CO2 Emitter
Energy-Related CO2 Emissions, Global and Chinese Power Sector
Source: IEA, 2009
China has Ambitious Goals for Renewable Generation Capacity
2009 Capacity
Existing Target
Proposed Target
Hydropower 196 GW 300 GW 300 GW
Wind 18 GW 30 GW 150 GW
Solar 0.3 GW 1.8 GW 20 GW
Biomass 1.1 GW 30 GW 30 GW
Sources: 2009 capacity is from CEC (2010). Existing and proposed targets are from Martinot (2010).
2009 Capacity, Existing and Proposed Targets for Renewable Capacity
PlanningInvestmentDispatchPricing
Regulation
Centrally Planned:Coal-fired
Generation Serving Industrial Loads
Post-Planned:Diverse Generation
Sources Serving Diverse Loads
An Incomplete Transition
China’s Electricity System is Relatively Expensive
Sources and Notes: China data are from SERC (2010); U.S. data are from EIA (2010).
Average 2009 Retail Electricity Prices in China and the U.S., Ranked by Province/State in Ascending Order
Industry Dominates Load
Source: Data are from CEG (2008).
Shares of Electricity End Use by Sector, China, 1980-2006
Forecasted Demand Growth in China is still High
2009 Actual and High/Low Forecasted 2020 Electricity Demand, China and U.S.
Sources: China “2009 Actual” is from SERC (2010); “2020 – Low Forecast” is from IEA (2009); “2020 – High Forecast” is from Zhang (2009). For the U.S., all data are from EIA (2010).
An Evolutionary Moment for China’s Power Sector
High forecasted growth
Structural shifts in demand
Growing environmental awareness and regulation
Rising wholesale and retail energy prices
Reducing Demand Growth is Key for Reducing Share of Coal
Shares of Coal and Non-Coal Generation, 2009 and Low and High Demand Growth Scenarios for 2020
Regional Power Grids in China
Western Inner Mongolia Power Grid (WIMPG)
State Grid: Northwest, Northeast, North, Central, EastSouthern Grid: South
Summary
Reforms in planning, investment, dispatch, pricing, and regulation are precondition for power sector decarbonization in China
Without capacity to better manage and allocate costs, will be difficult to meaningfully increase share of renewable generation in China
Progress possible through incremental improvements in institutional planning and regulatory capacity
Soft technology transfer in electricity sector management should be priority area in OECD-China climate policy dialogue
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