Welcome to Azure International

Azure International is a leading investment and advisory company focused on China's cleantech energy sector. Founded in 2003, we have a team of 20+ local and international professionals based in China with backgrounds in engineering, marketing, manufacturing, consulting, policy, government relations and finance. In addition to deep advisory capabilities in renewable energy, energy efficiency, carbon management, and energy finance, we have proven capability to invest in and accelerate the development of clean energy companies.  Our portfolio and partner companies have achieved both significant commercial success and returns to investors. Azure provides the necessary expertise and execution capabilities in China to lead relationship development with government and strategic partners, project execution, sourcing, sales and technology development – all with deep understanding of Chinese and international requirements.

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Wind – China’s National Energy Administration lists 34 GW of pre-approved wind projects: In its 5th release since the beginning of the 12th Five Year Period, the NEA listed 541 wind farms comprising 34 GW of capacity. This builds upon the 107.7 GW in capacity listed in the previous four approvals, a majority of which has already been grid connected. Projects on this list will have 2-3 years to undergo local approvals and finish construction. Otherwise, their development rights will be revoked. The list shows a strong shift in wind power development into lower wind speed areas closer to China’s Eastern load centers. Citing curtailment issues, Xinjiang, Liaoning and Jilin had no approved projects on the list. Also of note, this is the first list of projects to fall under the lower wind FiT pricing system. The fact that China will well exceed its 2015 wind installation target will likely inspire the government to revise its 2020 targets up from 200 GW to over 250 GW. (NEA CN)
 
Wind – Q1 2015 NEA statistics signal the return of wind power curtailment: Average nationwide wind power curtailment jumped 6.6% to 18.6% during the first three months of 2015. This was led by worsening curtailment situations in China’s Northeast and Northwest grids which had curtailment rates of

33% and 20% respectively. The provinces of Jilin, Liaoning, Heilongjiang, West Inner Mongolia, Gansu and Xinjiang all experienced wind curtailment rates above 25%, with Jilin notably curtailing over 58% of wind power generation. The situation should improve during the rest of 2015 as combined heat and power use declines during warmer spring and summer months.  However, the dramatic jump in wind power curtailment is a lesson for analysts and developers who interpreted improvements in 2014 to be part of a long term downward trend. (NEA CN)
 
Grid – China’s electricity consumption grew 0.8% in Q1 2015, yearly consumption forecast revised down to 1%:  On April 29, the China Electricity Council released first quarter generation and consumption statistics as well as forecasts for the remainder of 2015. According to the CEC release, industrial energy consumption dropped 0.6% during the first three months of 2015 while commercial electricity consumption grew 7%.  From a regional perspective, electricity consumption dropped 2.1% in China’s Northeast – likely exacerbating wind curtailment problems in the region – while electricity consumption in China’s fast growing Western regions was only 1.9% - down from 8.4% in Q1 2014. Despite consumption growth slowdowns, new generation capacity grew 9.2% over the same period. The CEC had previously forecasted 2015 electricity consumption growth to be 4-5%. If electricity consumption growth, specifically at the regional level, continues to miss forecasts and new generation builds continue as originally planned, then the current generation oversupply situation may worsen, eventually creating higher wind, solar and hydroelectric curtailment. (CEC CN)
 
Wind – SunEdison announces 149 MW wind farm acquisition in China: As part of an announcement that covered 757 MW of operating wind, solar and hydroelectric capacity across seven countries, SunEdison announced that it acquired 149 MW of wind operating capacity from Honiton Energy Holding, Ltd. The projects are located in Inner Mongolia. (SunEdison EN)
 
Renewable Energy – Ministry of Finance releases new management guidelines for renewable energy subsidy fund: The latest policy, which follows a series of modifications aimed at solving China’s subsidy redistribution woes, defines sixteen articles related to the oversight of subsidy redistribution. The policy does not explicitly change the subsidy redistribution mechanism, but does clearly place greater pressure on provincial level Ministry of Finance offices to supervise and report misappropriation of funds. (MOF CN)
 
Renewable Energy – Beijing to test using renewable energy for heating: As part of Beijing’s continuing effort to improve its air quality and better utilize clean energy sources from surrounding regions, the National Energy Administration announced that Beijing will use electricity provided by surrounding wind farms to provide public heating. The first project will be hosted just north of Beijing in Yanqing and the area will aim to supply 100% of its heating needs through clean electricity. A similar pilot has been tested in Inner Mongolia for several years and its spread to Beijing is a strong indicator of national development potential. (NEA CN)
 
Energy Storage – Wind, solar and energy storage demonstration commissioned in Yunnan: On May 4, a 20 MW wind, solar and energy storage demonstration began operation in Longshan, Yunnan began operation. This project, which is the first of its kind in Yunnan combines wind and solar at a single transmission interconnection – the aim being to better utilize grid infrastructure while taking advantage of wind and solar’s complementary load profiles. (NEA CN)
 
Electric Vehicles – New energy vehicle subsidy system defined through 2020: To provide consistent and sustained support to China’s electric and fuel cell vehicle industry, the Ministry of Finance, Ministry of Science and Technology, Ministry of Industry and Information Technology and National Development and Reform Commission jointly released a notice for the financial support of China’s new energy vehicle industry. The policy release also contains a breakdown of 2016 subsidies by vehicle type. (MIIT CN)
 
Policy – NDRC releases notice to improve cross-provincial electricity pricing mechanism: Following the guidance of the NDRC’s major notice on power system market reform - #9 document – this policy release calls for a greater negotiation in brokering cross-provincial power exchange deals. It calls for transmission prices to be fixed based on underlying costs so that direct agreements between large generation plants and surrounding grids can be brokered. It also calls for pricing, once defined, to vary in accordance with changes to local benchmark coal prices. This policy is particularly important for regions like Yunnan and Sichuan that export large amounts of hydroelectricity as it has the potential to lower the cost of hydroelectricity for surrounding provinces, incentivizing them to boost their electricity imports. In addition to pushing greater marketization, this change of pricing policy also has the potential to alleviate hydro curtailment problems in China’s Southwest region. (NDRC CN)
 
Policy - NEA releases 2015 plan for market oversight: The plan contains 24 measures covering a range of topics, many of which fall within China’s electricity market reform efforts. In particular, article 22 calls for greater adoption of direct electricity purchases between generators and large electricity consumers. (NEA CN)
 
Policy – NDRC suggested pricing policy aims to change electricity pricing authority and method:  This policy, covering electricity and other commodity pricing setting mechanisms, calls for competitive wholesale prices and fixed transmission and distribution prices. This notice signals what China is working towards, but does not define specific goals or strategies for reform. (NDRC CN)
 
Coal – NEA releases plan for the elimination of backwards production capacity in China’s coal industry. The plan calls for the elimination of 77.79 million tons of coal production capacity across 1254 mines in 2015. In particular, Heilongjiang and Guizhou are expected to phase out 233 and 200 mines respectively. This policy will help lessen the current oversupply which has driven coal prices down significantly over the past year. (NEA CN)
 
Solar – NEA releases comprehensive list of standards and testing measures for Chinese PV. (NEA CN)
 
Energy Efficiency – Xi’an Ship Engineering Institute and Jiangxi Huadian sign a strategic cooperation agreement to develop low grade waste heat generation market in Northwest China. (SXDaily CN


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