China is the world’s biggest polluter, consuming more coal than the rest of the world combined. It is now taking global leadership in combating climate change and has pledged to drastically cut its use of fossil fuels. Central to that plan is to increase renewable energy by 20 per cent by 2030.
But many question whether the rhetoric is matching reality. In the middle of China’s coal heartland of Datong, solar panels fill the hilltops as far as the eye can see. The project, called Top Runner, employs cutting-edge technology. And its success will, in part, determine how far and how fast solar energy can be rolled out across China.
The project is totally wireless and its conversion rate of sunlight to electricity is as high at 17 per cent. So far enough power is generated for 65,000 homes. Pu Chengjun, who helps manage the project from Three Gorges New Energy, says it has the potential to transform the local area.
“The structure of energy and economy will be adjusted. It will change from coal mining, heavy industry to clean energy, new energy, solar energy. It’s a model project,” he says. Communities in Datong have been destroyed by rampant coal mining. The water table has been poisoned and the land has subsided. Only small amounts of land can be used for agriculture.
Many villages that once lived off the riches of coal now lie derelict and abandoned. Mr Pu believes solar energy can revive the area’s fortunes. “It will provide about 1,000 jobs a year in construction and maintenance and the company pays rent of more than half a million dollars a year to the locals for land that was useless,” he says.
Nationally, solar only generates about 2 per cent of China’s electricity and wind power a little more than 3 per cent, but much more is in the pipeline. China says it will be the world’s biggest investor in renewables and has pledged $400 billion by 2030.
But the problem is much of the electricity is not getting onto the grid. It is being squeezed out by coal, which provides three-quarters of the nation’s energy needs. Coal is cheap, and China is self-sufficient. And that has created a dependency.
Coal is firmly entrenched and much of China’s business and political elites are making billions from it. Yuan Ying, the manager of climate and energy at Greenpeace China, says the coal culture will be a challenge to change, and top decision-makers down do not regard solar as a viable alternative yet.
“The whole power system is pivoted around coal, a lot of employment, a lot of incomes, a lot of GDP growth is relying on the coal industry. In the provinces the local officials prefer coal,” she says.
Many of the massive showcase renewable projects in the outer provinces are too far away from the energy-hungry cities and industrial centres of the east, and transmission lines and the grid haven’t been upgraded to utilise the power. Ms Yuan says the situation is improving, but 20 per cent of renewable power that is generated is being lost.
“In western parts large amounts of energy produced by solar and wind is wasted and not integrated into the grid, that brings a lot of losses for the companies operating the renewables,” she says.
The other issue is cost. Renewable energy is still expensive compared to coal. Those in the solar industry in China, like Huang Xinming from JA Solar, say it is only a matter of time before technological breakthroughs bring lower prices.
“It won’t take too long, maybe five years,” Mr Huang says. “Then it will be a low-cost, clean and stable fuel of the future. In the last decade it’s already dropped from $5.00 to 40 cents a watt.” Whether China can recast itself as the world’s leader in clean energy will depend on how effective energy reforms are, and how fast the coal culture can change.
But the Chinese public, usually apolitical, may be the biggest drivers in the country’s energy transition as they are demanding a cleaner, safer future.