• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile

  • CORONAVIRUS
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » China’s Great Energy Shift Sets Mega Hybrid Projects in Motion

China’s Great Energy Shift Sets Mega Hybrid Projects in Motion

Renewables Are the Only Winners in Historic Decline in Energy Demand
Source: Bloomberg
May 13, 2020
Bloomberg

In China’s latest efforts to pit renewable energy against fossil fuels, it is again betting on size.

Resources such as wind and solar don’t stand much of a chance if there isn’t a way to store energy when the wind doesn’t blow and the sun doesn’t shine. So some of China’s biggest state-owned companies are pouring in billions of dollars to build massive projects that will combine the two with energy storage.

The periodic nature of renewables is a challenge because it disrupts the conventional methods for planning the daily operation of the electric grid. The idea with these hybrid projects is that they will allow a more continuous supply of clean power, which will better enable China to reduce its reliance on coal, a major source of smog and climate-warming greenhouse gases.

While these integrated projects are mainly for demonstration purposes at the moment, it signals the direction of development for the industry, said Shen Zhifeng, an analyst at UOB-Kay Hian Holdings Ltd. Future projects “are likely to trend toward this model as costs decline with increasing construction.”

The pairing of wind and solar is a popular option as developers bet that having the two technologies work in tandem can provide more consistent energy generation than having a standalone system. By combining a battery storage solution, the reliability of the electricity supply is further improved.

Mega Projects

State-owned giants working on such projects include GD Power Development Co., which is planning to build a $2 billion project with up to 2 gigawatts of capacity in northern Inner Mongolia. Utility Beijing Jingneng Power Co. will invest in a $3 billion project with 5 gigawatts of capacity. Both will also produce hydrogen — an emerging fuel alternative — using clean energy.

Notwithstanding the fact that China consumes more coal than any other country by far, it has signaled an intention in recent years to become cleaner and greener. It has the world’s biggest renewable energy fleet, but struggles at times to make full use of this capacity due to grid constraints, a situation known as curtailment.

Energy storage remains a crucial part in ensuring the integration of renewable sources onto the power grid, said BOCOM International Holdings Co. analyst Louis Sun. The technology is “inevitable,” but has a long way to go, he added.

BloombergNEF estimates that China will add more than 400 megawatts of new renewable storage capacity this year, about four times the amount in 2019.

The bulk of the expected increase will come from wind-plus-storage projects in Hunan and Anhui, where provincial grids have agreed to prioritize connection for hybrid projects to ease congestion, BNEF analyst Li Daixin said.

China Huaneng Group and China Three Gorges Renewables Group Co. are among 28 companies building new storage projects in Hunan with 389 megawatts of capacity. The plants will enter operation with almost 1.9 gigawatts of new wind power capacity.

Subsidy Catalyst

The end of renewable energy subsidies is becoming a “catalyst” as developers rush to commission their projects before the deadline and look to improve their chances of financial support by supplementing renewables with storage systems, Li said.

China is not alone in adding storage to renewable energy projects. Japan and Australia deployed more wind-plus-storage projects in 2019, according to Wood Mackenzie Ltd. However, renewable power storage remains a small market for batteries, with more than 90% of production going to electric vehicles and personal electronics.

Whether the technology can be developed on a greater scale depends on government policies and profitability, said WoodMac’s senior analyst Xu Le. “Without subsidies, developers will find it hard to make money from utility storage projects based on the current power market structure,” Xu said.

His view is shared by Shen Qiang, vice president of GCL Energy Technology Co., which provides energy storage services. While the technology faces some near-term challenges, he said the industry remains bullish about its prospects and is accelerating expansion.

“Companies are putting in a lot of effort to test it out,” Shen said.

RELATED CONTENT

RELATED VIDEOS

Sustainability & Corporate Social Responsibility Chemicals & Energy China
KEYWORDS Chemicals & Energy China Sustainability & Corporate Social Responsibility
  • Related Articles

    Cargill Sets Sail for Lower Energy Consumption in Ocean Transportation

    Website Devoted to Energy Efficiency in Maritime Projects

Bloomberg

Biggest U.S. Ports Rank as World’s Least Efficient for Containers

More from this author

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • digital work

    Supply Chain Managers Are Quitting in Unprecedented Numbers

    Coronavirus
  • North Jakarta, Indonesia

    Physical, Financial Visibility: A Dual Approach to Supply Chain Resilience

    Supply Chain Planning & Optimization
  • Diversity in the Workplace

    Supplier Diversity Certification Is More Art Than Science

    Sourcing/Procurement/SRM
  • shopping

    Want to Put a Stop to Counterfeit Goods? Take a Picture

    Supply Chain Visibility
  • Amazon

    Amazon Aims to Sublet, End Warehouse Leases as Online Sales Cool

    Logistics

Digital Edition

Scb may 2022 sm

2022 Supply Chain ESG Guide

VIEW THE LATEST ISSUE

Case Studies

  • 3PL Doubles Productivity With Robots to Fulfill Medical Supply Orders

  • E-Commerce Company Cuts Order Fulfillment Time by 40%

  • Fashion Retailer Halves Fulfillment Time With Omichannel Automation

  • Distributor Scales Business by Integrating Warehouse Automaton Software

  • Fast-Growing Fashion Brand Scales E-Commerce Fulfillment With Whiplash

Visit Our Sponsors

Yang Ming Alithya Barcoding
Blue Yonder BNSF Logistics Generix
GEP GIB USA GreyOrange
Here Honeywell Intelligrated Inmar
Keelvar Kinaxis Korber
Liberty SBF Locus Robotics Lucas Systems
Nvidia Old Dominion Parsyl
Redwood Logistics Saddle Creek Logistics Schneider Dedicated
Setlog Holding AG Ship4WD Shipwell
Tecsys TGW Systems Thomson Reuters
Tive Trailer Bridge Vecna Robotics
Whiplash    
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2022 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing