China – More investments into offshore wind power construction

China will give top priority to developing offshore wind power projects to boost its flourishing wind power industry in 2010, according to a senior energy official. The government would put large-scale offshore wind power concession projects out to tender, said Shi Lishan, deputy director of the New Energy and Renewable Energy Department of the National Energy Bureau at a recent seminar sponsored by Chinese Renewable Energy Industry Association (CREIA).

"We have formulated basic ideas and formalities for the tenders," said Shi, but he would not elaborate on the timetable and exact sites in the concession project list. Han Wenke, director of the Energy Research Institute of National Development and Reform Commission (NDRC), said China had no choice, but to vigorously develop renewable energy, including wind power. To reach the ambitious target of constructing a moderately prosperous society in 2020 and become a medium developed country level in 2050, China must boost its economy and naturally consume more energy, Han said.

China relies on coal for about 70 percent of its energy. The government expects to increase non fossil-based energy sources to 15 percent of total energy consumption by 2020, with wind power playing a major role. At present, fossil-based energy sources supply 87 percent of the country's total energy consumption. On Jan. 23, 2010, China's National Energy Bureau (NEB) and State Oceanic Administration (SOA) jointly put into effect an Interim Measure on the Management of Offshore Wind Farm Development. Regulating every aspect of offshore wind farm development, the 38-article document is widely seen as a boost for offshore wind farms across the country.

It stipulates that offshore wind farms must be developed through public tender, with consideration of offered prices to send power to grids, project plans, technical abilities, and performance results. The developers must be Chinese-funded enterprises or Sino-foreign joint ventures with majority Chinese ownership. There are no restrictions banning foreign businesses from exclusively investing in land-based wind farms. But since Chinese land-based wind farms barely make money, no foreign businesses solely run wind farms on the Chinese mainland.

The measure also requires that if the businesses do not start construction within two years of winning the tender, the NEB will revoke project development rights. The NEB has asked the country's 11 coastal provinces to report plans for offshore wind farm concession projects. In April 2009, the NEB required the provinces to map out offshore wind farm programs. Under the policy of unified planning and stage-based construction, the NEB will approve a number of sites for offshore wind farms with 1 million kilowatts or higher of installed capacity.

"The offshore wind farm concession projects initiated on this basis will accumulate experience for China to develop large offshore wind farms in the future," said Qin Haiyan, secretary general of the China Wind Energy Association.

Last year, 10,129 sets of wind turbines were installed, totaling 13,803MW, up 124 percent over the previous year. By the end of 2009, China's total installed wind turbines reached 21,544, amounting to 25,805MW, up 114 percent over the end of 2008. China has overtaken Germany as the second largest wind power developer after the United States. However, China is still beginning to develop its offshore wind power sector, due to complex operating environments for offshore turbines, high technological requirements, and construction difficulties.

Offshore wind farms are constructed in sea areas below the average high tide marks of coastal areas over the years, and uninhabited islands in sea areas. However, offshore wind power remained an orientation of future wind power development, said Qin. China's offshore wind power potential is estimated at more than 750 million kilowatts (exploitable at the height of 10 meters), much larger than the 253 million kilowatts of exploitable land-based wind power potential, said China Meteorological Administration.

For more information please contact Trevor Sievert at ts@windfair.net