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Power Firms Expand Renewables Footprint

Chinese power companies are expanding their presence in global green energy projects, with a particular focus on solar and wind power, according to an industry report.

Major Chinese power companies have so far invested in and operated 14 energy grid projects in 11 countries and regions, with the cumulative value of overseas engineering contracts reaching $376 billion and overseas investment at $106 billion, the China Electricity Council said in a report released recently in Beijing.

The outbound expansion of Chinese power enterprises in terms of investment, services, equipment and technology continues to accelerate, it said.

Chinese power companies have actively engaged in cross-border transmission line interconnections and electricity trading with neighboring countries last year, including Russia, Mongolia, Vietnam and Myanmar, said Yang Kun, executive vice-chairman of the council. This has not only promoted the sharing and exchange of clean energy resources, but also supported the development and utilization of renewable energy on a regional scale, Yang said.

Key components of wind turbines account for over 70 percent of the global market, while the production share of polycrystalline silicon, silicon wafers, solar cells and modules in the photovoltaic industry exceeds 80 percent globally, he said.

The council predicts the country’s combined installed capacity of grid-connected wind and solar power to exceed that of coal power by the end of this year, accounting for about 40 percent of the total installed capacity.

China’s installed capacity of nonfossil energy generation exceeded that of thermal power for the first time last year, accounting for more than half of the total installed capacity, hitting 53.9 percent, while the proportion of coal power installed capacity dropped below 40 percent, according to the council.

Driven by the overall recovery of the country’s economy, China is likely to experience robust growth in electricity demand this year, with power consumption on course to reach 9.8 trillion kilowatt-hours, up 6 percent year-on-year, supported by the ongoing electrification of the residential and transport sectors, as well as a notable expansion of the data center sector, said the council.

Chinese power companies have comprehensive advantages in technology, capital and equipment, making it competitive at the global stage while driving the greening trend worldwide, said Luo Zuoxian, head of intelligence and research at the Sinopec Economics and Development Research Institute.

Ever since China ceased new overseas coal-fired power projects in 2021, the power industry in China has made active adjustments, with major domestic power companies shifting their focus to green investments, Luo said.

They are playing a greater role in injecting strong momentum into sustainable local economic and social development, he added.

In addition to solar and wind power, sectors including energy storage, hydrogen energy, carbon capture, utilization and storage (CCUS) and integrated energy also possess massive development opportunities, Luo said.

The cumulative installed capacity of power generation in China rose to 2.97 billion kilowatts by the end of February, a year-on-year increase of 14.7 percent, with solar power reaching 650 million kilowatts, a year-on-year increase of 56.9 percent, and wind power up 21.3 percent year-on-year to 450 million kilowatts, according to the National Energy Administration.

Meanwhile, total investment in power generation projects by major power generation enterprises nationwide was 76.1 billion yuan ($10.57 billion) in the first two months, an increase of 8.3 percent year-on-year. The investment in grid projects was 32.7 billion yuan, an increase of 2.3 percent year-on-year, said the administration.

China’s electricity consumption, a key barometer of economic activity, logged robust expansion in the first two months of 2024, with power use climbing 11 percent year-on-year to 1.53 trillion kilowatt-hours during the first two months this year, it said.

All these indicate an economic recovery in the country, said the council.

Specifically, power consumed by primary and secondary industries went up 11.1 percent and 9.7 percent year-on-year, respectively. Power used by the tertiary sector soared 15.7 percent, said the administration.

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