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Zhejiang province to limit coal production and energy consumption
According to this notice, Zhejiang will control the proportion of coal production, limit the development of high energy-consuming industries and promote development of new energy such as wind, PV and biomass. ( ZJDRC)
Azure has summarized some of the key data in the graph below:
Despite the notice announcing more support for new energy, we are in fact surprised by how small the numbers are for new wind installations. The projections are reasonable in light of historical installations, with average annual installations of 160MW over the past 7 years, but they are not in line with the target of reaching 4GW by 2020 according to the province's 13th 5 year plan, starting from 1.3GW in 1H2018. We therefore assume that wind targets listed above are not including distributed wind projects nor offshore wind. Zhejiang currently has 252MW of offshore wind under construction and more than 1.2GW already approved.
NEA publishes national coal power ultra-low emission and energy saving targets
2018 National coal power ultra-low emission target: 48,680MW.
Energy saving transformation target: 53,905MW. (NEA)
Energy saving target map below:
Wind production accounts for more than 5% of national total in 1H2018
A total of 82.9TWh of wind power was produced in China during 1H2018 ,accounting for 5.4% of total on-grid power. Wind power trading reached 19.8TWh inluding 9TWh of cross-provincial trading. (CEC)
1H2018 Wind power market trading diagram
Large power generation groups have participated in wind power transactions in 16 provinces, with the three provinces of Yunnan, Xinjiang and Gansu accounting for more than half. The average transaction price in these provinces (including production as well as cross-provincial and / or cross-regional transmission price s) ranged between 0.37 and 0.44 CNY / kWh.
Fujian and Shandong cancel subsidies for distributed PV projects
Following the “531” < 国家发展改革委财政部国家能源局关于2018年光伏发电有关事项的通知> ( NDRC)policy realised earlier this year, Shandong & Fujian provinces are officially cancelling subsidies for newly connected PV project. The final subsidy amount or power tariff depends on the timing of both registration and connection of the project (BJX)
Fujian distributed PV subsidy breakdown
China's first flexible high-voltage direct current (VSC HVDC) offshore wind farm
ChinaHuadong Design Institute is planning to open a groundbreaking 1.1 GW offshore wind farm 90 kilometres from the coast of Jiangsu Province in eastern China. DNV GL announced that it will provide technical support for the feasibility study of China's first flexible high-voltage direct current (VSC HVDC) offshore wind farm converter station. ( BJX)
Compared with traditional submarine high voltage AC power transmission (HVAC), VSC HVDC can minimize power losses and is suitable for long distance and large capacity project.
NDRC requires power trading companies to carry out shareholding reforms
According to NDRC document #9 <中共中央国务院关于进一步深化电力体制改革的若干意见> and as part of the power market reform, many new power trading companies have been setup over the past two years. The result however is that most power trading companies are still wholly-owned subsidiaries of the grid company. In this new policy, NDRC now requires that preferably 50% and at least 20% of power trading companies stock be owned by enterprises independent of state grid. ( NDRC)
Guandong DRC publishes opinion on new bidding mechanisms for wind farms
Guangdong is the first province to publish clarifications on the specific mechanisms which will be used to allocate wind farm subsidies following the new competitive on-grid tariff guidelines requirements issued by NEA earlier this year. The document provides some details on the scoring scale which will enable to compare bidders, as well as guidelines on procedures for applying for subsidies. (GD DRC)
According to theNEA policy issued earlier this year (NEA), the tariff related score for both onshore and offshore wind farms should account for at least 40% of total score. The remaining criteria are listed in the pie charts above. For offshore projects, the business capability score, which relies on a specific scale for rating references, is the second most important criteria with a weight of 30%. For onshore projects progress on preliminary construction is given more importance.
Jan to Jul energy statistics published by NEA
From Jan to Jul, power consumption in China reached 3,877.5TWh, a 9% increase yr-on-yr. Wind showed the strongest growth, with new installations of 9.46 GW, with utilization hours improving as well. (NEA)
Azure has summarized key information in the graphs below:
3-Gorges Guangdong 400MW offshore wind farm approved by Yangjiang DRC
The project has a sea area of approximately 67km2, waterdepth of 21 to 26m and distance to shore of 15.9km. The project will feature 73 5.5MW wind turbines with a projected annual production of 1.5TWh.
SPIC secures project approval for 2 offshore wind farms in Guangdong province
SPIC Jieyang Jinghai 150MW & Shenquan PhaseI 400MW offshore wind projects have been approved by Jieyang DRC. The two projects will require a combined number of 101 5.5MW wind turbines. Both projects plan to start construction by the end of 2018 and will be operating in 2021.(JYDRC)
Mingyang is the only turbine supplier with a 5.5MW turbine on the market and is securing a large number of orders in Guangdong province where it is headquartered, especially this year as developers are rushing to secure approvals while the 0.85 CNY / kWh feed in tariff is still available.
Mingyang and SPIC sign an MOU for cooperation on offshore wind
Mingyang and SPIC signed an MOU regardingfixed as well as floating offshore wind. The strategic partnership will be focused on offshore wind power development, clean energy equipment supply, technical cooperation, international projects, information sharing, engineering construction and ancillary services.(BJX)
NEA publishes 1H2018 solar power installations
During the first half of this year, 24 GW of new PV capacity was installed. This includes 12GW of centralized PV, a decrease of 30% yr-on-yr, and 12GW of distributed PV, an increase of 72% yr-on-yr. The total installed PV capacity has now reached 154.5GW, about three quarters of which is centralized. (NEA)
In the first half of 2018, newly installed PV capacity in Shandong, Zhejiang, Henan and Jiangsu provinces all above 1GW, and the newly installed distributed photovoltaic installations in the four provinces accounted for more than half of the country.
HHI signs an offshore wind construction & installation contract with 3-Gorges
Huadian Heavy Industries (HHI), a subsidiary of Huadian Group, won the bid for the first batch of foundation construction and installation of 38 wind turbines as well as an offshore high voltage substation for the 3-Gorges Guandong Yangjiang Xishaba 300MW offshore wind project. The contract is worth 1 billion CNY. (Finance Sina)
Source: Yangjiang GOV
Jiangsu power grid load exceeds 100 GW for second consecutive year
On August 8, Jiangsu Power Grid load reached 102.26 GW, breaking last year's record of 102.19GW. From January to July this year, total power consumption in Jiangsu reached 349.5TWh, an increase of 6.78% yr-on-yr. Appoximately 22% of this power demand was produced from renewable energy sources.(CEC)
China EV charging infrastructure annual report (2017-2018) published by NEA
777,000 electric vehicles were sold in China in 2017, an increase of 53.3% year-on-year, allowing EV market share to reach 2.7%. In 2017, there were 214,000 public charging stations and 232,000 private charging stations. Construction of another 600,000 charging stations is in planning, including 100,000 public and 500,000 private. (NEA)
Highway power charging network
Shanghai Electric terminates acquisition of subsidiary of GCL-Poly
In June this year, Shanghai Electric announced its intention to acquire 51% of Jiangsu Zhongneng, a subsidiary of GCL-Poly (HK3800) focused on high-purity polysilicon production, for 12.7 billion CNY. Shanghai Electric now terminates the acquisition procedure. (Finance Sina)
The acquisition was cancelled due to changes in the photovoltaic situation since the second half of the year. Especially after the “531” PV New Deal, the two sides have different judgments on the trading conditions and the future development prospects of the PV market.
NEA publishes 1H2018 wind power on-grid operation situation
During the first half of this year, 7.94GW of new wind capacity was connected to the grid, reaching a total of 171.6 GW. Wind farms produced a total of 191.7TWh, an increase of 28.7% yr-on-yr, with average utilization hours increasing more than 10% since last year. (NEA)
The wind curtailment isssue has also been significantly improved, with curtailment decreasing more than 10% in the provinces of Jinlin, Heilongjiang and Gansu.
157MW of offshore wind installed in 1H
With an additionnal 157MW connected during 1H, the total on-grid offshore wind capacity in China is now 2.7GW. (NEA)
While 157MW is not a big number, we expect more significant installations in the second half of the year, allowing 2018 to be a record year for offshore wind in China.
Guangdong 2018-2020 “Blue sky defence” plan published by Guangdong Department of Environmental Protection
The plan lists installed capacity targets for all clean energy, including 16GW of Nuclear, 6.5GW of Wind and 5GW of PV. Key cities for deployment of offshore wind are Zhuhai, Shantou, Shanwei, Yangjiang, Zhengjiang and Jieyang. By the end of 2020, the province should have more than 2GW offshore wind in operation and more than 6.5GW under construction.(GDEP)
As a power import province, and the most populated province in China with a population above 100 million, Guangdong has a lot of grid space to build its power generation capacity. In 2017, Guangdong consummed 595.9 TWh but produced only 451.6 TWh.
Hainan's first pumped hydro energy storage (PHES) station put into operation
The 600MW PHES project has 3 units of 200MW each and projected annual power generation of 1.0 TWh for a total investment of 3.4 billion CNY. This dam is adjacent to Hainan province load centers and to nuclear power transmission channels. (Hainan News)
Once it comes into operation, the PHES station will enable to reduce the average peak-regulation rate of thermal power in Hainan by 11%, and to increase provincial thermal power annual utilization hours by 374 hours.
Beijing-Tianjin-Hebei included in new energy vehicle battery recycling pilot
The NEA has launched a large scale pilot project to explore technical and market solutions to encourage recycling of batteries used in electric vehicles. So far the projet will involve the regions of Beijing-Tianjin-Hebei, Shanxi Province, Shanghai and Guangdong Province. The annoucement also introduces China Railway Tower Co., Ltd as a key player in the pilot project. (GOV) (NEA)
Fujian GOV issues list of offshore wind farms
Fujian GOV released a plan requiring the different government offices across the province to fully support implementation of 228 major projects, including 130 under construction and 98 in development, in order to accelerate the growth of the "marine economy" in the province.
We have extracted offshore wind projects out of the document as well as summarized key information in the tables below. The list includes 9 offshore wind farms with cumulative capacity of 2.7GW and average CAPEX of 20,800 CNY/kW.
China's largest grid connected ESS project comes on line
The 20MW/160MWh intelligent energy storage power station of the Feida Group invested by Nandu Power (300068) was successfully connected to the grid. The power station is a key project of the State Grid Jiangsu summer peak shaving plan. The project has an annual energy storage capacity of about 53 million kWh. (ntdaily)
According to the State Grid Jiangsu Power Forecast, peak summer consumption in Jiangsu has reached 112 million kW in 2018, an increase of 10% since last year. Now that the Chinese economy is transiting from a secondary to a tertiary economy, while the total consumption growth is predicted to slow down, we can actually expect the growth of peak consumption to accelerate, which drives up the requirements for the scale of the whole energy production and transmission infrastructure but drives the utilization hours down. Energy storage peak shaving projects are one of the solutions to increase the efficiency of the whole system.
Large fire at South Korean energy storage power station
A fire broke out at the energy storage project connected to the Lingyan Wind Power Plant, causing the 706m2 scale battery building and more than 3,500 Li-Ion batteries to burn. The grid scale energy storage project with a capacity of 12MWh was installed in 2015. (Sohu)
This news item was found by Azure on several news platform in Chinese language, but has not been reported anywhere else to Azure's knowledge. Azure is investigating the accuracy of this news item, and in the meantime does not guarantee its validity. Fire hazards with Lithium Ion battery is a well know issue and a key concern in the sector, as well as a drive for development of alternative battery technologies.
Japan builds first PV power plant from recycled PV modules
Japan's NextEnergy&Resources builds a PV power plant using recycled PV panels. The project has an installed capacity of 280.78KW and features five different panel technologies including monocrystalline, polycrystalline, CIS thin film etc. (BJX)
By the end of 2017, China had a total PV capacity of more than 130GW Including 50GW newly installed during 2017. At this pace, recycling PV material should soon become an important topic in the industry.
NDRC promotes participation of renewable energy projects in power trading programs
According to the new policy, direct power trading mechanisms are now open to medium size end-users which connect to the grid at 10kV or above (versus 35kV in previous versions of the policy) and sources of clean energy such as wind, solar, hydro and nulcear are encouraged to trade directly with large industrials such as coal, steel, nonferrous metals, cement and glass producers. (NDRC)
As Azure had forecasted a few years back, while the direct power trading mechanisms introduced over the past years were intially expected to have a positive impact in helping integrate clean energy, in reality it is more likely that lage coal power plants with stable and controllable production sign up with large industrial producers with flat and predictable consumption. The policy confirms that more work is needed to help clean energy sources be competitive in a deregulated market.
3-Gorges group publishes its 2017 sustainability report
The report describes how 3-Gorges plans to create a large-scale development platform for new energy such as offshore wind power. The Group's target is to develop wind and solar energy as its second main busines after hydro, mainly focusing on large-scale development of offshore wind power.
Three Gorges' Fujian Fuqing Xinghua Bay Phase I demonstration project is now in operation, featuring 14 wind turbines from 7 different manufacturers with unit capacity between 5 MW to 6.7 MW and a total installed capacity of 78.4 MW. The demonstration project has had positive press last week as the offshore turbines just withstood Maria typhoon without any damage.
CATL Battery will invest Euro 240 million to set up a battery production base in Germany and secures $4.7 billion contract from BMW
Under the joint witness of the Chinese and German prime ministers, China CATL and the German state government of Thuringia signed an investment agreement in Berlin. According to the agreement, CATL will set up a battery production base and intelligent manufacturing technology research and development center in Erfurt, Thuringia. (Sohu)
In 2017, CATL shipped 11.84 GWh of lithium-ion batteries, ranking first in the global market with a 17% market share.
MIIT publishes new list of encouraged construction material technology and products
The list published by the Ministry of Industry and Information Technology promotes the transformation and upgrade of the construction material industry, as well as costs reduction, increase in efficiency and acceleration of the supply-side structural reform. The list also addresses the problem of overcapacity in the cement and glass industries. (MIIT)
The list has a total of 48 items. An interesting one is the addition of electrochromic and thermochromic smart windows as well as other shading systems, including specific performance requirements..
China leading wind gearbox manufacturer NGC to be acquired by Neoglory Prosperity Inc
Neoglory Prosperity Inc announced its intention to acquire NGC (Nanjing High Accurate Drive Equipment Manufacturing Group Co., Ltd) for a total asset value above 2 billion USD. Neoglory Prosperity released a major asset purchase plan which described the intention to have its Five Season subsidiary acquire between 834 and 1,208 million shares of NGC (00658, HK), representing 51% to 74% of the company, for a price ranging between RMB 9.99 and RMB 11.25 per share.(SinaFinance)
NGC is the leading Chinese wind turbine gearbox manufacturer, supplying a large number of domestic and international wind turbine OEMs. Neoglory Prosperity Inc. (hereinafter referred to as "Neoglory Prosperity ", stock code: 002147.sz), listed on the Shenzhen stock exchange since April 2016, is a commercial and tourism real estate developper as well as a precision machinery manufacturing company.