10 World roundup

China needs REFIT

By the end of 2005, China had installed 61 wind farms with a power-generating capacity of 1,260 MW, making it seventh on the list of the world’s major wind players. However China is currently using a competitive ‘public bidding’ scheme to support wind power, with contracts awarded to the lowest bidder. This has led to some very low prices, in the range 0.4 to 0.5 yuan /kWh, making it hard, according to wind energy developers, for small companies to finance projects.

So far the successful project have been put forward by the country’s big five power companies, including China Huaneng Group and China Guodian Corporation, who enjoy preferential tax policies, which helps them earn a refund of 0.1 yuan/kWh. However, as with similar systems, like the UKs Renewable Obligation, the prices are unpredictable, and if China is to meet its ambitious 30GW by 2020 wind energy target, it may have to adopt a revised approach. At a recent wind energy conference it was argued that a feed-in-tariff system was needed. Arthouros Zervos, chair of the Global Wind Energy Council said: ‘The price volatility and uncertainty caused by the current regulation harms foreign and domestic private manufacturers and developers, who are discouraged by a pricing pressure they cannot sustain’.

Last year GWEC, the Chinese Renewable Energy Industries Association and Greenpeace produced a joint report claiming that the current practice of bidding is in conflict with the aim of capacity expansion and called on the Chinese government to change the price tendering mechanism for wind power to a German-styled fixed tariff system, which would mean the price is regulated directly by the government.

The report contends that the four bidding rounds so far have established the basis for a shift from a bidding price to a fixed price. Under a fixed tariff system, the authors note, China could be divided into three wind resource categories, with different fixed prices in areas with ‘rich’, ‘exploitable’, or ‘fair’ wind resources. This could help to meet the 30GW by 2020 target ahead of time.

Source: article by Xiaohua Sun for Worldwatch recycled by RenewableEnergyAccess.com

Brazilian Biofuel push

Brazil, which is the world’s largest sugar producer, is also a leader in ethanol production- which it has used to power cars for decades. Flex-fuel vehicles now make up 80% of its new car sales and ethanol production has reached almost 17 bn liters, while exports have more than tripled in two years, reaching 2.6 bn liters in 2005. It sells ethanol to Asia, Europe and N. America, who take the most- about 60%. But following President Bush’s commitment to biofuels (re-asserted in this years State of the Union address), the USA is now developing its own ethanol production programme, using corn. However it is claimed by critics that corn ethanol produces only about 1.5 times the energy it takes to grow versus about 8.3 times for cane ethanol. Reuters reported that ‘Brazilian ethanol, which is subsidy-free, is competitive with gasoline prices as long as world oil remains above about $30 to $35 a barrel, whereas US ethanol production from corn is even now heavily dependent on a 51 cents-a-gallon federal tax credit’, and it says that Brazil expects to expand ethanol production for export; one expert claimed that it ‘could double, even triple, the land planted with cane’.

At present, Brazil produces 450 million tonnes of cane on 6 million hectares. Environmentalists have criticized Brazil’s expanding ethanol programme, since they say that cane crop expansion could threaten rainforest. But it is claimed that Brazil could double the area planted without cutting down any trees if it used only degraded pastureland and already deforested areas: see the Dutch report on this issue reviewed in Renew 166. Meanwhile, a report by BioWorld Today has suggested that the fast-expanding biofuels market could falter unless there is ‘significant innovation in cellulosic ethanol’ from biomass like plant stalks and wood chips. It claims that ‘Corn cannot conceivably handle the displacement of gasoline in the US anymore than crop-based ethanol can keep pace with global gasoline consumption’. Source: Reuters

Geothermal, tidal in NZ

A 90MW, $275m geothermal power plant is being built in New Zealand, at Kawerau in the Bay of Plenty. It should be completed in 2008 and will be the country’s largest geothermal development in over 20 years, producing more energy annually than all of the country’s existing wind turbines. A further 800MW of resource has also been identified, and the overall national potential has been put at 1.2 GW. Geothermal has the advantage that, unlike wind and hydro, it is not subject to the climate variations such as wind speed or the amount of rain fall. Globally there’s around 9GW of geothermal electricity generation, plus about the same amount of heat production capacity.

In parallel New Zealands Northland Regional Council has received an application from Crest Energy Ltd., to build a 200 MW tidal power plant with 200 tidal turbines just north of Auckland. The project, in the mouth of Kaipara Harbour, would have two 20-mile DC cables run across the harbor. Once completed in 2011, the $400m project is expected to generate about 4% of the country’s annual energy supply. Assuming a positive outcome to the application, Crest Energy plans to raise capital through a public share offering. Source: RenewableEnergyAccess.com

Meanwhile, as reported in the Technology section of Renew 167, there are plans to have a 1MW array of floating sub-sea turbines installed in the Cook Strait between the North and South Islands, by 2008.

New Zealands new draft energy strategy claims that ‘there is likely to be enough geothermal, wind and hydro energy to meet New Zealand’s electricity demand for the next 10 to 20 years while still meeting appropriate environmental standards’, adding ‘If marine generation or solar photovoltaic generation become economically viable within that period, New Zealand would be able to utilise predominantly renewable electricity sources for even longer’.

Cape Cod wind

The long running controversy over the proposed 130 turbine windfarm off the coast from Cape Cod in New England continues. But RenewableEnergyAcess.com reported that last years Democratic party revival saw a major local political ‘anti’ removed by a strong supporter- Republican Governor Mitt Romney, a Cape Wind opponent, chose not to seek re-election in Massachusetts. His lieutenant governor and potential successor, Kerry Healey, who also campaigned against the project, lost to Democrat Deval Patrick, a strong supporter of the project. But there is still some way to go- the regulatory review will not be completed until 2008, although interim agreement on the undersea cable link has been reached. There are around 12 other offshore wind projects being considered in the USA. e.g. Texas has proposed a 150MW project about seven miles off of Galveston.

Clean Skies: Contrary to Bush’s claims, the Clean Air Act does cover CO2 , says the US Supreme court

Big US bash: The USA is to host a Global Renewable Energy Conference in 2008 in Washington DC, co-ordinated by ACORE, the American Council On Renewable Energy. WIREC 2008 will follow on from the major 2004 gathering in Bonn.