Renewable Energy Share in China Falls

Posted by: Frederik Balfour on January 28, 2009

China’s goal of increasing the amount of renewable energy it produces is failing. According to the Chinese Environmental Law blog, the actual percentage of wind, solar, and hydro power of the total electricity generation has fallen in both of the past two years. That’s alarming not only for Chinese citizens but for the rest of the world, as China is now the largest emitter of green house gases on the planet. [We here in Hong Kong are particularly aware of China’s exported pollution, much of which blows south from Guangdong province. See the blog just posted by my colleague Bruce Einhorn for more on this. It also means that China is moving further away from its target of producing 15% of its electricity by renewable energy by 2020.

China relies more than ever on coal to power its heavy industries and electricity generation. Solar and wind power have long been a more expensive alternative, and they have become even relatively more expensive in the past 9 months as coal prices have plunged. One encouraging sign is that the prices of solar panels are falling quickly. The world’s largest solar panel maker Suntech expects them to drop up to 30% this year. In the meantime, let’s hope that a good chunk of the $584 billion fiscal stimulus China plans on spending in the next couple of years will go towards investing in more renewable energy sources which the market can sustain, such as methane from recycled waste.

China has just announced it will subsidize the purchase of electric, hybrid and fuel cell autos by 13 municipalities. That sounds encouraging, even when you consider that most of the energy used to recharge these green vehicles is still produced through burning coal. According the BYD Auto, which rolled out a hybrid plug-in last December, the reduction in emissions from reduced gasoline use more than offsets the amount produced by coal burned to supply electricity. If anyone has hard data to back this up or challenge it, I would be very interested in hearing your feedback.

Reader Comments

Dan Harris (China Law Blog)

January 28, 2009 12:53 PM

Yes but....the large decline in manufacturing will probably reduce green house gases below year ago levels in any event. Right?

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Bloomberg Businessweek’s team of Asia reporters brings you the latest insights on business, politics, technology and culture from some of the world’s biggest and fastest-growing economies.

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