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China research smart grid_insights China research smart grid_insights Presentation Transcript

  • Learn more @ www.zpryme.com | www.smartgridresearch.orgDecember 2011Zpryme Smart Grid Insights Presents:China: Electricity ProfileWhat implications will the dramatic shift in China‟s electricitycocktail have for the United States and rest of the world? Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world? “Coal price growth has outpaced state [China] set electricity tariffs… Electricity output is falling back on coal generations slow down.” 1 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011 Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.Quote: Ric Deverell, Credit SuisseSource: Bloomberg, Dinakar Sethuraman, Coal Demand Hurt in China by Low Power Rates, November 18, 2011
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?China’s Electricity Profile at a GlanceAccording to the International EnergyAgency‟s World Energy Outlook 2011 by2015 China will overtake the U.S., andbecome the leader in total electricitygeneration capacity. What‟s more, by2035 China will consume nearly 70%more energy than the United States...From phasing out incandescent light bulbs within five yearsto optimizing the countrys clean energy mix, what‟sextraordinary about China‟s electricity infrastructure is thespeed and scale of its expansion. The solar, wind, coal,hydro, and related renewable technology and generationis galloping at a champions pace, surpassing the U.S. andrest of the world. For example, China has now become thenew world leader in wind power, having overtaken theU.S., with 40.2 GW (just three years earlier China‟s 2020wind deployment goal was set at 30GW, currently it‟s amighty 200GW) while attracting the highest new financialinvestments for two years in a row with $49 billion USD inrenewables, i.e. about a third of total global investments(since August 2010 China continues to be the mostattractive country for renewable investment, followed byU.S., Germany, India and Italy).To meet this electricity cocktail, the Chinese governmenthas outlined major plans and dedicated billions toresearch, design and build a nationwide Smart Grid.Zpryme projects the total value of China‟s Smart Grid2 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?market to rise from $22.3 billion USD in 2011 to $61.4 billion muffled next year as domestic electricity producers mayUSD in 2015, an annual growth rate of 29.1 percent over pay higher rates to import the fuel to develop power andfive years (see figure 1).1 net generous year over year returns. Not helping the economic energy situation, power providers in China are Projected China Smart Grid Equipment & Technology Market struggling to recoup their costs as governments restrict 2010 - 2015 | in U.S. billions | CAGR = 29.1% prices to curb inflation, reducing the incentive to boost Figure 1, Source: Zpryme $70 $61.4 electricity generation from thermal coal. China may have $60 to slow imports of the fuel next year after increasing $49.6 shipments by about 10 percent this year, according to the $50 $39.2 China Coal Transport and Distribution Association.3 To $40 $30.1 combat this, China is working diligently to build more, but $30 $22.3 cleaner, coal-fired power plants to meet the demand. The $20 $17.1 U.S. is also expected to demand more energy, but is starting with a smaller base of coal-fired generation $10 (dissimilar to China, many of the older U.S. coal-fired units $0 are expected to be driven out of the energy pool in the 2010 2011 2012 2013 2014 2015 two decades).4Driving the Chinese Smart Grid initiative are technologies What’s Next for China?in spaces such as solar. Since the Chinese governmentannounced the “Golden Sun” initiative in 2009 it‟s led in On January 18, 2011, the U.S. DOE (Department of Energy)solar investment. Still, the Asian nation is starting to feel the released a report detailing the substantial progress madedampness of the solar bubble; more recently, losses for to date on a number of clean energy initiatives betweenChina‟s largest solar manufacturers, including Suntech China and the U.S. Since then, China has been wedgedPower Holdings Co. and JA Solar Holdings Co. may by negative global economic trends; however the Chinacontinue through next year.2 Electricity Council still projects an increase in electricity consumption of 8.5% per year.5 The Smart Grid coupledOn the other side of the energy coin, it‟s no surprise that with next-gen technologies in spaces such as wind willthe world‟s leading emitter of greenhouse gases still reliesoverwhelmingly on coal (consuming 3.5 times as much 3 Jakarta Globe (originator: Bloomberg), Coal Prices Not Likely to Recover in 2012 Ascoal as the U.S.). Demand for coal in China could be China, India May Limit Purchases, November 27, 2011. 4 E&E Publishing, Joel Kirkland, U.S. and China strive for fruitful but competitive developments in clean technology, November 29, 2011.1 Zpryme Smart Grid Insights, China: Rise of the Smart Grid, January 2011. 5 The China Electricity Council said in late October 2011 that China‟s electricity2 BusinessWeek, Christopher Martin and Zachary Tracer, China Solar Makers Face consumption growth would continue to slow during the rest of this year as the„Suicidal‟ Prices on Excess Output, November 25, 2011. government is making efforts to save energy and cut emission.3 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?offer a unique paradox for a nation that has not evenskimmed the surface of both emitting greenhouse gassesand clean-tech preeminence. With Chinese governmentcooperation, foreign companies that are quick topenetrate this market will find that 2012 is the year theirbrand become synonymous with the Smart Grid.Key China Electricity Profile Findings  From 2010 to 2015, world total electricity generation capacity is projected to increase by 284 GW, from 4,623 GW to 4,907 GW, respectively. During this time period, China will account for 63% (179 GW) of the world‟s increase in generation capacity. From 2010 to 2035, China is projected to account for 39% of the world‟s increase in generation capacity.  By 2015, China will overtake the U.S., and become the leader in total electricity generation capacity.  By 2035, China will account for a quarter of the world‟s electricity generation capacity.  By 2035, China will account for nearly half (49%) of the world‟s coal fired generation capacity at 1,043 GW.  By 2015, China will lead the world in the hydro and other renewable electricity generation, accounting for 21% (248 GW) of world capacity. This figure is projected to reach 24% (581 GW) by 2035.  China‟s wind generation capacity will grow by 1200% from 2010 to 2035, reaching 533 GW by 2035. LEARN MORE: please see the next several pages for China projection totals on: electric generating capacity, coal, renewable, hydro, wind, and solar.4 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?China ElectricityProjections forTotal:electric generatingcapacity, coal, renewables,hydro, wind, and solar.5 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?Total Electric Generating Capacity Coal Fired Generating Capacity Projected Total Generating Capacity (GW) Projected Coal Fired Generating Capacity (GW) 2010 - 2035 2010 - 2035 Figure 2, Source: EIA International Outlook, 2011 Figure 4, Source: EIA International Outlook, 20118,000 7,272 2,500 6,769 2,1297,000 6,269 1,968 5,796 2,000 1,8106,000 5,312 1,627 1,646 1,677 4,9075,000 1,5004,000 1,043 9623,000 1,000 848 670 695 733 1,666 1,8172,000 1,313 1,492 976 1,118 5001,000 1,049 1,075 1,085 1,119 1,170 1,221 322 322 323 326 329 334 0 0 2010 2015 2020 2025 2030 2035 2010 2015 2020 2025 2030 2035 United States China World United States China World Percent of World Generating Capacity Percent of World Coal Generating Capacity 2010 - 2035 2010 - 2035 Figure 3, Source: EIA International Outlook, 2011 Figure 5, Source: EIA International Outlook, 2011 100% 100% 90% 90% 80% 80% 39% 38% 37% 35% 34% 35% ROW ROW 70% 59% 59% 59% 58% 58% 58% 70% 60% China 60% China 50% 50% United 44% 47% 49% United 40% 40% 41% 42% 49% States States 30% 20% 21% 23% 24% 25% 25% 30% 20% 20% 10% 21% 20% 19% 18% 17% 17% 10% 20% 20% 19% 18% 17% 16% 0% 0% 2010 2015 2020 2025 2030 2035 2010 2015 2020 2025 2030 20356 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?Hydro and Other Renewable Generating Capacity Wind Generating Capacity Projected Renewable Generating Capacity (GW) Projected Wind Generating Capacity (GW) 2010 - 2035 2010 - 2035 Figure 6, Source: EIA International Outlook, 2011 Figure 8, Source: EIA International Outlook, 20112,500 2,372 600 2,209 533 2,054 4962,000 1,890 500 456 398 1,578 4001,500 1,300 293 3001,000 180 581 200 139 156 494 532 119 456 99 500 330 100 157 248 179 184 194 201 205 38 31 51 62 51 54 55 57 0 0 2010 2015 2020 2025 2030 2035 2010 2015 2020 2025 2030 2035 United States China World United States China World Percent of Renewable Generating Capacity Percent of Wind Generating Capacity 2010 - 2035 2010 - 2035 Figure 7, Source: EIA International Outlook, 2011 Figure 9, Source: EIA International Outlook, 2011 100% 100% 90% 90% 80% 80% ROW ROW 70% 70% 62% 61% 62% 62% 61% 60% 69% 68% 66% 67% 67% 67% 60% China 60% China 50% 50% United United 40% 40% States States 30% 30% 17% 21% 25% 26% 28% 29% 20% 19% 21% 24% 24% 24% 24% 20% 10% 10% 21% 17% 12% 11% 10% 9% 9% 9% 13% 12% 11% 11% 0% 0% 2010 2015 2020 2025 2030 2035 2010 2015 2020 2025 2030 20357 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world?Solar Generating Capacity Projected Solar Generating Capacity (GW) 2010 - 2035 Figure 10, Source: EIA International Outlook, 2011 119 120 106 97 100 86 80 62 60 40 25 18 19 20 21 20 9 7 11 11 12 13 3 1 0 2010 2015 2020 2025 2030 2035 United States China World Percent of Solar Generating Capacity 2010 - 2035 Figure 11, Source: EIA International Outlook, 2011 100% 90% 80% ROW 70% 66% 69% 70% 71% 60% 74% China 85% 50% United 40% States 30% 21% 20% 20% 11% 19% 18% 3% 10% 15% 12% 13% 11% 11% 11% 0% 2010 2015 2020 2025 2030 20358 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • China Electricity Profile: What implications will the dramatic shift in China‟s electricity cocktail have for the United States and rest of the world? Zpryme Credits Editor Managing Editor Research Lead Robert Langston Sean Sayers Stefan Trifonov Disclaimer These materials and the information contained herein are provided by Zpryme Research & Consulting, LLC and are intended to provide general information on a particular subject or subjects and is not an exhaustive treatment of such subject(s). Accordingly, the information in these materials is not intended to constitute accounting, tax, legal, investment, consulting or other professional advice or services. The information is not intended to be relied upon as the sole basis for any decision which may affect you or your business. Before making any decision or taking any action that might affect your personal finances or business, you should consult a qualified professional adviser. These materials and the information contained herein is provided as is, and Zpryme Research & Consulting, LLC makes no express or implied representations or warranties regarding these materials and the information herein. Without limiting the foregoing, Zpryme Research & Consulting, LLC does not warrant that the materials or information contained herein will be error-free or will meet any particular criteria of performance or quality. Zpryme Research & Consulting, LLC expressly disclaims all implied warranties, including, without limitation, warranties of merchantability, title, fitness for a particular purpose, noninfringement, compatibility, security, and accuracy. Prediction of future events is inherently subject to both known and unknown risks, uncertainties and other factors that may cause actual results to vary materially. Your use of these and the information contained herein is at your own risk and you assume full responsibility and risk of loss resulting from the use thereof. Zpryme Research & Consulting, LLC will not be liable for any special, indirect, incidental, consequential, or punitive damages or any other damages whatsoever, whether in an action of contract, statute, tort (including, without limitation, negligence), or otherwise, relating to the use of these materials and the information contained herein.9 www.zpryme.com | www.smartgridresearch.org Zpryme Smart Grid Insights | December 2011Copyright © 2011 Zpryme Research & Consulting, LLC All rights reserved.
  • Learn more @ www.zpryme.com | www.smartgridresearch.org