“The world’s largest and most devastating environmental and industrial project is situated in the heart of the largest and most intact forest in the world, Canada’s boreal forest. It stretches right across northern Canada, in Labrador, it’s home to the largest remaining wild caribou herd in the world, the George River caribou herd, numbering approximately 400,000 animals.”

~ Garth Lenz

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Hydro power (or hydroelectricity power) is the most widely used form of renewable energy, accounting for 16% of global electricity generation – and is expected to increase about 3.1% each year for the next 25 years. The Asia Pacific region specifically generated 32% of the global hydro power in 2010, and China’s total capacity is 22% higher than any other countries’ install base. Similarly, according to the “Renewables 2012 Global Status Report”, China’s capacity even exceeds that of Brazil, the USA and Canada combined. With this momentum behind it, China’s government targets for continued hydro power installation are equally astounding. By 2015, China’s hydro power installations are targeted to reach around 325 GW, and with a newly revised target of 430 GW (up from 380 GW) by 2020. China’s love affair with this renewable energy source looks set to continue over the next decade as investment in hydro power becomes one of China’s key areas of focus. (Source – New Scientist, Xinhua, China Global Times, Deutsche Bank, own interviews).

To understand who is charged with managing this rapid growth, it is easy to see China’s top 10 players (predominantly State Owned Enterprises) are operating essentially all the installed capacity of hydro power. In terms of the construction of Chinese hydro power facilities, the three dominant market leaders belong to the State Owned Assets Supervision and Administration Commission (SASAC) and the Chinese Armed Police Force.

Source: State Electricity Regulatory Commission (SERC) – China Electricity Council

Industry Advantages

Hydroelectric dam in Xiaojin County.

The chief advantage of hydro power is its considerable cost-effectiveness in comparison with other renewable energy forms, such as wind or solar. Electricity produced by hydro electric power is the most cost-effective and stable form of renewable energy, allowing developers to install hydro electric power without the need for considerable feed in tariffs. Hydro power also benefits from flexibility, with plants being able to adjust their output quickly to adapt to changing energy demands over certain periods.

Hydroelectric plants have long economic lives, with some plants still in service after 50 years. Operating labor cost is also usually low, as plants are automated and have few personnel on site during normal operation.

Industry Disadvantages

Although hydro power is the most cost-effective method of creating energy from a renewable source, challenges such as the long development periods, associated social displacement and environmental concerns as well as the increasing difficulty in accessing potential development sites suggest that China’s investment in hydro power will decline after 2020. Social and environmental consequences of large hydro power installations are another inextricable challenge for hydro power. Almost 1.5 million people were displaced due to the construction of the Three Gorges Dam, a level of displacement which, according to analysts, will make future hydro power development more complicated. The enormous reservoir created in the Yangtze River by the Three Gorges Dam project is now plagued by pollution and in 2009, construction on a major hydro power dam project was halted due to environmental objections. (source – International Rivers Organisation) In 2012, China is still experiencing one of the most severe droughts in the past 50 years, affecting water availability and flows, complicating the coordination and integration of hydro power. However, whether or not such issues will severely impact China’s continued investment in hydro power is uncertain.

Three Gorges Dam

China’s Three Gorges Dam spanning the Yangtze River is the world’s largest hydro power station in terms of installed capacity with a maximum capacity of 22.5GW. The dam became fully functional on 4 July 2012 when the last of the 32 main turbines began production. The project is regarded as a historic feat of engineering for China and can be considered a turning point in the development of the domestic hydro power industry. Through the development of the project, the Chinese industry gained valuable technological capabilities through partnering with foreign suppliers.

Period of Adjustment

China’s wind power industry is currently facing a rather unique period. Its period of adjustment began in 2011, as the newly installed wind power capacity began to experience a slowdown of its rapid growth. The increase in government regulations and requirements resulted in a consolidation across the market of turbine and related component manufacturers throughout China, but the move by the Chinese government was a necessary act to enable the power grid capabilities to catch up and begin establishing a smart grid system, by which wind energy could be properly harnessed

Source: Global Wind Energy Council

The government aims for 100GW of total installed wind power generation capacity in 2015 with 5 of those GW based off shore. Further off shore capacity is expected to expand to 30GW by 2020 with the help of subsidies and feed in tariffs to support the government’s self-imposed goals of greater overall reliance on wind power due to improved wind power connectivity.

Current Industry Overview

China is the world’s largest wind energy market boasting 25% of the total global installed wind capacity. However, the rapid growth was so misguided and unkempt that the lack of regulation resulted in an overheated market that drew significant investment despite the lacking infrastructure necessary to support the wind farms that were popping up all across China. Today, China’s wind power market is expected to plateau, but industry watchers believe there is hope for the recovery of the wind power production in a time horizon anywhere from 2 – 10 years. This, however, cannot be resolved until the infrastructure of the power grid is properly developed to harness energy from the rural countryside wind farms and bring it to the high demanding city centers and manufacturing industrial locations traditionally based in the coastal cities.

Growth regulation

Before 2011, China’s wind power industry was unscrupulously managed as investments and farm installations were quickly and easily approved at provincial levels. Wind power facilities were built without being grid connected. Liu Mingliang, an analyst from the China Wind Energy Association remarks that this led to a serious shortage of grid connected wind power facilities as network planning was outpaced by the construction of these wind power farms. This triggered the central government’s need to contain the growth and ensure that the investments, indeed a form of the vast infrastructure stimulation, were being wisely put to use. In the case of the wind power facilities, this translated directly to a need to contain the provinces from issuing any more wind projects that were not directly aligned with the intentions or plans of the State Grid system.

Grid Connectivity Improvement

The reality in China’s wind power story is that a mere 1% of China’s total electricity is generated by wind power. This means the central government will be forced by potentially unpopular decisions to focus their attention, and indeed their funds, to energy production initiatives with more impact. The effort to harness wind power to a more elaborate grid system may not be the wisest investment given the weak return that can be expected in terms of electricity production output, which can be expected even with a proper grid system. Despite the fact that over 30% of total wind power generators are still waiting to get properly “hooked up” to the grid, the wind power generators who are successfully connected are suffering from transmission problems and curtailment, and this has nearly punctuated China’s position on needing to shift to alternative means of renewable energies.

To further illustrate the connectivity challenges that lie at the heart of China’s wind power story, China’s power transmission lines are insufficient and unable to distribute electricity long distances from their rural wind farm locations to the population centers due to a dated existing grid system. More long range transmission lines are needed to cover the massive size of this country, but again, the high cost doesn’t bring with it a structured ROI to justify the investment. This reality makes it easy to imagine that many projects will likely be stalled and remain unconnected as the power companies will not have a proper way to earn back the investments that would be required to connect the vast wind farms to the urban centers.

Chinese firms take the lead in smart grid technologies, and their involvement in partnership with other country stakeholders is required. As much as RMB 3.8 trillion is invested in 3 main stages: pilot which occurred in 2009 – 2010 and addressed standards establishment; construction which has been happening since 2011 and will continue to do so until later in 2015 and involves distribution networks and remote monitoring systems; and industrialization which will be the implementation of plans to be performed in 2016 and beyond.

While it’s clear the lack of grid connectivity is a major flaw in the architecture of China’s ability to rely in the future on wind generated energy, the state of smart grid technologies around the globe remain at a relatively nascent stage. As stated by Zhu Shunquan, China’s National Renewable Energy Centre’s analyst, it’s necessary to realize that smart grid technologies are still being developed internationally at an early stage. Given China’s power grid is a state run entity, the lacking liberal market system that may help to shape a flexible and demand-driven system may hinder China’s ability to create a value-added, profitable system by which to harness and utilize this energy.

Offshore Wind Capacity

China has extremely ambitious offshore wind targets. Currently, there are around 750GW of exploitable wind resources offshore – 3 times more than on land, admittedly larger than planned.

In July of 2010 the National Energy Bureau and the State Oceanic Administration issued rules for offshore development to try and curb the numerous offshore wind farms being built. Under these regulations, offshore wind farms must be constructed no less than 10 kilometres from shore, and in waters no less than 10 metres deep. The aim of this mandate was to limit the development of near shore stations (occuring primarily in Jiangsu and Shandong Provinces), creating further obstacles for developers to extend significantly in off shore.

The Industry Trends – Consolidation and Internationalization

Vestas, Goldwind, and GE Energy are the top three key players in China’s wind power industry and are each experiencing downsizing with sporadic upticks in their 2013 stock prices due to China regulatory announcements that seem promising for some of these companies. That said, local competitors are becoming more fierce as they adjust and revamp their strategies and operations with the potential to benefit from policies that could be of greater benefit to the Chinese producers. According to Liu Mingliang of China National Wind Energy Association, by the end of 2011 there were 80 domestic wind turbine enterprises in China, with its top 10 sharing 84% of the market, meanwhile only 3.5% of the market is occupied by a fragmented 60 other enterprises. By default of healthy competition, the least skilled with limited research capability firms are forced out of the game. To survive in this warfare, industry consolidation is hence occurring at all levels of firms scale.

With an eye on sustaining growth – regardless on what land it may be on, the domestic wind power installation slowdown has spawned an outward looking investment appetite on the part of large Chinese manufacturers who are aiming to expand their operations abroad. This phenomenon is likely to continue even in the case of a domestic market recovery. Those firms are quickly adapting to the international local content rules in the already politicised and regulated foreign markets in order to achieve any form of growth in these developed markets. Meanwhile, the foreign players who maintain their operating factories in China are expected to use it as a basis to expand into China’s neighboring countries at the early stages of development.

Summary

The unregulated and dynamic growth experienced in China’s wind power industry is indeed a thing of the past. In order to survive the downturn, or more appropriately, the equilibrium settling events in this market – the players who will be standing at the end of the day will be those who survived the consolidation amidst the highly competitive domestic market, while maintaining steady, albeit slower, growth in international markets despite the influx of Chinese wind power manufacturers.

Challenges for the future of wind power in China lie on the Chinese grid development and the continued postponement of offshore wind installations due to insufficient firms’ capabilities as well as coordination with the government bodies. Meanwhile, the opportunities in this industrial sector exist in the form of internationalization for local players, and advanced technology application that can be utilized by foreign players for the necessary advancement of China’s grid connectivity.
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Articles in the Series

The Importance of Renewable Energy in China

Solar Power in China

Hydro Power in China

This article is based on Solidiance‘s recent study about China’s Renewable Energy. The complete report of the study is free to download here. Solidiance is a leading Asia-centric B2B growth strategy advisory firm with full fledged presence across the Asia region.

More about Solidiance : www.solidiance.com

China is the fastest growing solar PV (Photo Voltaic) market in the world

In 2011, solar PV installations multiplied by nearly 3 times due to government’s increased commitment to industry development. This already overcrowded industry is pushing weaker firms out of the frame, whilst stronger firms are suffering from overcapacity issues, troubled technological development, international slowdown, and a general struggle for survival. Long term growth is expected to continue a rapid ascent, yet coordination and overcapacity issues need to be tackled to ensure growth can be maintained to a certain extent, in the short term.

Source: Global Wind Energy Council

Following the expansive growth of solar power in China leading up to 2011, the Chinese government is now targeting its total installed capacity to reach 21 GW by 2015 and 50 GW by 2020. This revised target demonstrates the Chinese government’s determination towards achieving their overall renewable energy targets and signals a firm belief this industry remains poised for growth, as well as being a suitable and sustainable platform for investment. Following the Fukushima disaster in Japan, China’s investment in nuclear energy has been reduced and offset by an increase in solar PV investment. The government is keen to develop the domestic solar power market swiftly through subsidies given and incentives to private manufacturers. Approximately 80% of China-manufactured PV modules and cells were exported by the end of 2011.

The domination by large SOEs in the former auction scheme which caused unintentional consequences of underbidding on large scale projects with the intent to capture market share is no longer allowed, thanks to the national Feed in Tariff (FiT), and it has stabilised the Chinese solar sector ever since – creating greater market competition and true dynamism within it. However, the FiT figures for 2012 only incentivised projects located far from demand centers where solar energy is more cheaply produced. Hence, BIPV (Building-Integrated Photovoltaics) systems which are traditionally focused near demand centers will struggle more in the near term compared to the rural-based LSPV (Large Scale PV) installations.

Current Overview

China is a multi-gigawatt solar PV market with newly installed solar PV capacity reaching over 2GW in 2011. The country is also the world’s fastest-growing solar PV market, with cumulative capacity to continuously ascend over the next few years. The majority of the new installations will be in grid-connected solar PV projects, such as BIPV and LSPV, to shift the market away from rural electrification.

Despite its impressive investment volumes and consistent growth, China’s solar PV market is currently dwarfed by Europe’s significant market control of over 75% of the globe’s total capacity in the global solar PV market. However, given the hard times that are now befalling Europe, China is positioning itself to fill a distinct niche in this particular sector as the EU shifts its attention to fixing their domestic financial crisis. The EU domestic financial crisis also means that its demand for PV is decreasing, thus paving the way for China to sustain growth in this industry.

Manufacturing market is now facing an increased competition and consolidation as the global value chain for solar PV is suffering from serious overcapacity. Components that are exceeded from the value chain are domestically reinstalled – hence increasing newly-installed capacity, yet setting up a confinement for foreign investment opportunities.

Industry Trends

Despite a high expectation towards China’s continued growth in installed solar PV capacity, the manufacturing industry has in fact been suffering from overcapacity and profit decrease. As for a result, a Solar Technology Developer of 3M stated that around half of the domestic module companies have disappeared in 2011, and what’s left and managed to survive in the battlefield were large companies with stronger technological capabilities.

Industry consolidation is rampant, but combined with the Chinese government’s push for increased solar installation, SOEs are vigorously entering the market which, historically, have been dominated by private firms. Moreover, as the price of silicon is decreasing at a consistent rate, (70% in Q3 2012 according to the Solar PV Committee of the Renewable Energy Society in China) smaller manufacturers initially focused purely on assembly functions are being squeezed out of the consolidation taking place in the market. This is believed to intensify the competitive atmosphere driving this market, however the longer term impacts remain uncertain.

Chinese companies are focusing on domestic orders to survive in response to the global financial crisis. According to a Solar Technology Developer at 3M, survival during this hard time seems to be the key goal and while the multi-national solar module manufacturers were focused on global markets which were more severely impacted by the global financial crisis, it was the local Chinese firms that made an aggressive push on developing domestic demand who are poised to come out of this phase of consolidation with a newly formed dominant position in the Chinese market.

Industry Opportunities

Potential for growth in the Chinese solar PV industry maintains a relatively bullish outlook for the strong who survive its ongoing consolidation. According to Solidiance’s analysis, the 3 main opportunities in this industry lie in the domestic development, new technology R & D (research and development), and cost reduction.

An opportunity to reinvest excessive capacity into the domestic market surely exists given the fact of the change in EU subsidies for solar PV, and this causes an abundant potential that China has for solar PV installations. For instance, Qinghai province alone possesses 1GW of installations, a figure exceeding the UK’s total solar installations and more than half of France’s in 2011. Qinghai is also where the world’s largest PV plant of 200 MW capacity is located, and it is equal to 6 times that of Brazil’s cumulative installed capacity in the same period. Moreover, 50% of the world’s supply of PV originates in China, indicating the technical capability is quickly achieving globally acceptable standards, making the local producers of solar PV well positioned to supply the anticipated domestic installation demand in the very short term.

Opportunities for technological innovation in the solar sector are continuously emerging. Lu Fang, the Secretary for the Solar PV Committee of the China Renewable Energy Society remarked that Chinese firms are now developing technologies and efficiencies of their solar cells on a ‘world class scale’. For example, Suntech Power, a Chinese firm and the world’s largest producer of solar panels, is researching technology to improve their mono and poly crystalline solar cells; Trina Solar, a Chinese manufacturer of photovoltaic modules, is also increasing their solar cells’ efficiency at impressively rapid rates. A Senior Electricity Analyst of the US Energy Information Administration even mentioned that an innovation of inexpensive and cost-competitive solar cells that are comparable with other electricity generation technologies would become a game changer in the global solar industry. It seems that Chinese companies are likely to be the first to access such technological opportunities.

Manufacturers are producing solar modules in greater volumes as the price of solar module components continue to drop due to the falling cost of silicon cells. They are also putting vendors under pressure to lower costs. It is then safe to say that the lower cost and higher efficiency modules are becoming one of the main opportunities in the Chinese solar PV market.

Industry Challenges

It is almost obvious that overcapacity issues faced by the solar PV industry in China present a short-term challenge for its future development. It creates an unfriendly and difficult environment to operate in for smaller, assembly-focused plants so they’re either falling out of the market or being bought up by larger, traditionally State Owned Enterprises despite their uncertain role within the market, resulting in higher competitiveness among chief solar module manufacturers.

Solar PV technology is comparatively more costly than hydro or wind power, with many technologies depending on subsidies and FiT. In order to witness sustainable growth, this industry will likely have to consider a rapid decrease in prices and a matching to grid parity. As silicon is expected to increase its market share within the thin film technologies by 10% in the next 2 to 3 years, this cost challenge is easing, according to the National Renewable Energy Centre.

In other well developed markets, demand for solar PV solutions is on the decline as has been witnessed in the USA and Europe. The USA is now focusing their financial incentives towards end consumers instead of sustaining the volume of imported product from other countries. Similarly, Spain and Germany reduced their incentives for solar installations overall due to the EU’s financial crisis. These given conditions pose additional challenges for Chinese producers of PV solar technologies from their traditional export model requiring them to prioritize domestic installation demand and further technological advancement in their solutions. Another challenge to face is that the LSPV systems installed in western deserts with the highest solar radiation levels will continue to struggle to be connected to the grid. However, when the solar power generated is at its highest and supply is high, the electricity demand on the grid is equally high, which enables more power to be accepted by the grid in cases where connectivity is not a constraint.

Summary

Solar PV market in China clearly shows future growth potential and is targeted for government investment. But the sector is facing a short term development issue as Chinese domestic module manufacturers are struggling to survive within the increasingly tight competition and decreasing international demand. Moreover, grid capacity and transmission problems also have their own impact to solar development and installation.
However, despite the existing challenges, China’s solar PV sector will likely grow due to its increasing technological capabilities and determination to develop the domestic market, although the regulatory system and proper coordination must remain top priorities to ensure the solar PV industry does not experience any further slowdown like what is being observed in China’s wind power sector.

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Articles in the Series

The Importance of Renewable Energy in China

Wind Power in China

Hydro Power in China

This article is based on Solidiance‘s recent study about China’s Renewable Energy. The complete report of the study is free to download here. Solidiance is a leading Asia-centric B2B growth strategy advisory firm with full fledged presence across the Asia region.

More about Solidiance : www.solidiance.com

Renewable Energy is a Necessity

In a world where its populations are increasingly proactive in battling problems such as climate change, greenhouse gas emissions, and rising oil prices, renewable energy is not only an option – it is now considered a necessity. Being one of the most populated countries in the world, China is not short of human resources and is a force to be reckoned with in terms of economic growth, not the least of which in the manufacturing sector where China is poised to be the world’s hub of manufacturing activities. However in recent years, China has come under intense scrutiny for the negative impacts this rapid growth has brought with it, most specifically in regards to the environment. The government is prompted to take effective emergency measures in order to preserve the amount of energy available within the country. This is supported with a continued interest in the matter even though the current economic development and growth is slowing down.

The subject of renewable energy has been on China’s main agenda these last few years, primarily since China has been in a rush to complete its self-prescribed target to reduce, among other environmental-related matters, carbon dioxide emissions released from greenhouse gasses. The development of renewable energy in China has been nothing short of rapid, and this can be seen by the increased amount of investment in renewable energy technologies and installations that have shown a significant rise throughout the 2000′s in China. However, while all this significant interest and rapid growth are encouraging, the consequences of rapid infrastructure building out such poorly aligned integration points (wind turbines to smart grid, for example) must first be dealt with before China can realize any of the aggressive targets it has set for itself.

China’s Stance on Renewable Energy

In order to acquire better insight into this continued interest in renewable energy in China, it is important to gauge its main causes. Solidiance has analyzed and identified 3 key factors: (1) China’s increasing demand for electricity; (2) the need to reduce its reliance on coal; (3) the need to reduce its greenhouse gas emissions. That being said, China’s increasing demand for electricity can be explained by a combination of the country’s rapid urbanization and significant fixed asset investment over the last two decades. China is not showing any signs of slowing down its productivity, but its increasing demand for electricity in order to keep these activities afloat can only hinder the available resources in the country. Despite that, there is encouraging progress regarding the use of electricity in China: according to World Watch Institute, about 17% of China’s electricity came from renewable sources in 2007, led by the world’s largest hydroelectric generators.

Meanwhile, China is also quickly realizing that coal will no longer be able to support the growth of its economy. Its reliance on fossil fuels in general, and coal in particular, is unsustainable and will put pressure on its abilities to continue a rapid growth trajectory in the long run. Moreover, there is also the fact that China is recorded as the third consumer of coal and peat in the world, generating up to 77% of the total electricity in 2010, after Brazil and India.

Source: BP Statistical Review of World Energy June 2011

China’s constant reliance on coal and peat also makes it the world’s highest emitter of greenhouse gasses, which results in alarmingly high carbon dioxide emission. China’s carbon dioxide emissions had reached such high levels in 2005 that it made the Chinese government pledge to reduce it by 40-45% in 2020. Based on these findings, the Chinese government has made a priority to heavily invest in renewable energies and increase the use of sustainable energy sources. However, much of this commitment is doubted by many experts who have commented that China’s reliance on coal and peat is indeed too heavy and they don’t see the situation changing any time soon, despite the fact that the Chinese government is confident in their ability to meet the self-prescribed target to heavily invest in renewable energy by 2020.

The Chinese Government Targets

The government’s decision was first demonstrated officially with the implementation of the China Renewable Energy Law, which was accepted as China’s first state-supported mandate to help develop the use of renewable energy in China. Even though the Chinese government is implementing multiple policies to promote renewable energy, the China Renewable Energy Law is still the key driver of renewable energy development in China. Passed in 2005 and officially implemented in January 2006, the China Renewable Energy Law stresses that the development and the usage of renewable energy is to be prioritized in the energy department.

By prioritizing the renewable energy sector, it presents China with an opportunity for global leadership. As further stated by China’s Vice Premier Li Keqiang: “In that environment, all we need to do is to take advantage of these [market] trends; if we respond appropriately we can seize this opportunity, gain the upper hand, and push forward a new breakthrough in development.” Indeed, China later proves its commitment in pursuing global leadership in renewable energies by increasing its investment at a staggering 80% per annum since 2004, as shown in the Solidiance analysis.

The 12th Five Year Plan 2011 – 2015

China’s driving policy doctrine, referred to as the “Five Year Plan”, is in its 12th issuance for the period from 2011 – 2015 and has a distinct and new focus on adjusting the country’s economic growth model with a specific focus on energy.

For the country’s energy objectives, it was decided that there would be 3 areas of focus for investment: clean energy, energy conservation and clean energy cars. Energy use is targeted to be reduced by 15% per unit of GDP, with carbon dioxide emissions to be reduced by 17% by the end of the planning period. However, despite its ambitious planning, there are many who are still not quite convinced by this pledge. As expected, many still question how effective these strategic targets will be at developing the supporting industries.

For example, to help meet its target during the 11th Five Year Plan, factories were shut down periodically during peak season. Naturally, as it was not the most effective and innovative method, it raises questions as to how well the government targets at a national level are coordinated with the development of China’s manufacturing and industrial sectors. .

Summary

The rapid growth of renewable energy projects being seen across China must be taken with a grain of salt. The “accomplishments” cannot be measured by the number of solar panels produced and the number of wind farms erected across China’s vast lands, but rather, the effectiveness of these tools to harness energy and the industrial population gradually shifting their reliance from traditional coal and peat to alternative sources is the true and only gauge of achieving these aggressive targets. Being acutely aware of this reality, the government’s energy plan aims to properly incent behaviors in these large emitters of greenhouse gas emissions to properly, albeit gradually, seek ways to reduce their dependence on coal. At the end of the day, the market economics must make sense for both the energy companies and the industrial consumers to come close to achieving the government’s aggressive targets.

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Articles in the Series

Solar Power in China

Wind Power in China

Hydro Power in China

This article is based on Solidiance‘s recent study about China’s Renewable Energy. The complete report of the study is free to download here. Solidiance is a leading Asia-centric B2B growth strategy advisory firm with full fledged presence across the Asia region.

More about Solidiance : www.solidiance.com

Biomass is an organic renewable energy source that includes materials such as agriculture and forest residues, energy crops, and algae. Scientists and engineers at the U.S. Department of Energy and its national laboratories are finding new, more efficient ways to convert biomass into biofuels that can take the place of conventional fuels like gasoline, diesel, and jet fuel. This edition of Energy 101 shows how biomass is broken down and refined into sustainable biofuels via biochemical and thermochemical processes.

For more information on biofuels from the Office of Energy Efficiency and Renewable Energy, visit the Biomass Program website.

Energiewende. Literally, it means energy turn. And since the turn of the millenium, Germany has decided to turn toward renewable sources for generating electricity in a big, big way. By shutting down its dirty power plants and weaning itself from fossil fuels now, the country aims to generate nearly all its electricity from renewables by 2050.

As recently as 2000, Germany produced less electricity from renewable sources than the U.S. A short 12 years later, Germany’s use of renewable energy had tripled, and by 2012 it was producing more than twice as much as the U.S. By 2040, Germany is projected to produce 65% of its electricity from renewables — 4 times the expected U.S. rate.

Contributing to Germany’s rapid progress is the fact that Germany has no oil or natural gas reserves of its own, but there’s far more than energy independence at play.

Unlike the U.S., Germany has no mainstream political movement that denies man’s influence on climate change, and nearly two-thirds of its citizens support a turn toward renewables.

Instead of mandating a top-down solution, the government has encouraged private sector investment, such that homeowners, farmers and small businesses can sell the renewable energy they generate and buy it back at a profit.

For all its successes, Germany’s approach is not without problems. The country is burning more dirty, soft coal than ever to generate electricity on windless and cloudy days. The surcharge required to support buy-back profits has increased energy costs by about two-thirds, and the nation is desperately in need of a smart grid.

Nevertheless, all major political parties and the citizenry remain convinced that generating power from renewable sources is the wave of the future, and together, they are determined to seize it.

In the video, courtesy of PBS, correspondent Rick Karr reports for Need To Know.

A USAID project in Yemen provides farmers with solar panels to improve productivity © Pathik Root/IRIN

Thirteen years ago electronics retailer Abdulmajeed al-Wahbani was one of the first people in Yemen to venture into the solar power business. So far the gamble has paid off.

His solar panel supply business found a niche and has seen impressive growth, while also helping to fight rural poverty.

“People need to work, and to secure their business and their life, they will go to solar power,” he told IRIN.

He said his rapid business growth is tied to a negative trend in Yemen – increasingly frequent and lengthy power outages over the past decade, especially during the political instability last year. Power cuts can sometimes last for weeks, acting as a brake on the economy, outside major cities.

In 2013 he is planning a nationwide advertising campaign to promote renewable energy – something he hopes will spread to the “entire country”. While that goal may seem ambitious, both the need and potential for renewable energy in Yemen are high.

Yemen’s western coast, from Bab al-Mandab to Al-Mokha, rates among the windiest corridors in the world, while the country’s frequently clear skies make it a prime candidate for solar power. More modest geothermal potential also exists.

The wider Arab region has a strong and under-exploited potential for solar energy for electricity production and desalination, according to a new report by the World Bank.

“We [in Yemen] have a good source of wind on the Red Sea, we have the sun, we feel we’re on a learning curve and going through a transition,” said Abdulaziz Daer, general manager of Dome Trading, which provides a range of services to the energy sector – at this point, mainly oil and gas companies.

By the Ministry of Electricity and Energy’s own estimates, renewable energy could potentially supply over 50,000 megawatts (MW) of power, or 50 times current production levels.

Some 70 percent of Yemen’s 25 million citizens live in rural areas – many far from the national grid. Even those lucky enough to have a connection get an intermittent service. Although no official study has been done, experts believe that Yemen produces only about a third of the total electricity needed – 1,000 MW out of an estimated demand of 3,000 MW.

Government Role

While renewable energy offers an attractive alternative to widely-used diesel generators, Daer says major changes in the Yemeni energy sector will only come about when the government does more to support commercial renewable projects.

He said small-scale renewable energy production, however admirable, is but “a drop in the ocean compared to the population of Yemen.”

Professor Hussain Al-Towaie teaches energy technology at the University of Aden and places the blame for the slow growth of the commercial renewable energy sector squarely on the shoulders of the Yemeni government and its subsidies on the oil used in most power stations.

“In my opinion, people that see there is a potential and do not do anything [are] actually against renewable energy,” he argues.

He says that by “pay[ing] for the conventional energy and not the renewable energy” the government is turning its back on the latter.

Dome Trading’s Daer said the government should “be the model” to show people the benefits of renewable energy, but both men are doubtful it has the necessary will or capacity to do so.

That view is not shared by Adel Abdulghani, general director of planning and information at the Ministry of Electricity and Energy, who cites existing policies as evidence of progress.

In 2010, the cabinet approved renewable energy, energy efficiency and rural electrification strategies that called for, among other things, renewable energy to contribute 10-15 percent of Yemen’s electricity by 2020, and 20,000 solar power units to be installed in rural Yemeni homes.

“We cannot say that the government doesn’t care, but there is no real governmental action toward pushing those strategies,” he told IRIN, citing Yemen’s political crisis as a major stumbling block.

“People that see there is a potential and do not do anything [are] actually against renewable energy” — Professor Hussain Al-Towaie, energy expert

In the aftermath of the Arab Spring, the Yemeni government and the international community have focused their attention on avoiding economic and political collapse.

One victim of these shifting priorities is a 60MW wind farm in Al-Mokha that has been in the works since 2009.

People that see there is a potential and do not do anything [are] actually against renewable energyProfessor Hussain Al-Towaie, energy expert The project ground to a halt when unrest broke out, and the World Bank was forced to reallocate millions of dollars’ worth of funding that it had originally designated for the wind farm to more urgent needs.

Lately though, there have been signs that renewable energy is regaining at least some momentum.

Hassan Taleb, a procurement specialist at the Electricity and Energy Ministry, told IRIN: “By next month we should announce the tenders for consultancy and also for implementation” of the Mokha wind project.

The government is also nearing completion of a deal to supply 7,000 individual solar units to rural areas.

However, until those installations become tangible examples, or small scale solar becomes widespread, many Yemenis will remain either skeptical or unaware of the potential for renewable energy to improve their daily lives.

USAID Project

The US Agency for International Development (USAID) recently started a programme which aims to address rural poverty by integrating renewable energy into the agriculture sector.

Earlier this year the agency began building demonstration greenhouses that use solar energy to power electric fans that help farmers avoid disease, and also provide water-saving irrigation techniques.

Experts at USAID say these systems are nine times more productive than farming on open land, and can operate independently of Yemen’s inconsistent power and fuel supply.

The benefits though come at a cost – the upfront costs (US$9,000) are prohibitive for most Yemeni farmers, many of whom lack access to formal credit.

“If the government has the ability to establish banks [and] credit facilities in the long term for the farmers, that could overcome the problem of heavy diesel consumption,” said Dome Trading’s Daer.

Source: IRIN

Forecasting wave height one second in advance optimizes energy collection, says a TAU researcher

In the search for alternative energy, scientists have focused on the sun and the wind. There is also tremendous potential in harnessing the power of the ocean’s waves, but marine energy presents specific challenges that have made it a less promising resource.

It’s a challenge to tune Wave Energy Converters (WECs) so that they are able to harvest the maximum energy from waves, which differ in terms of their size and force. This unpredictability leads to intermittent energy collection. WECs also need to withstand the harsh winds and storms to which they are subjected in the open sea — storms which can destroy the devices.

Now, working with a team at the University of Exeter in the UK, Prof. George Weiss of Tel Aviv University’s School of Electrical Engineering and Center for Renewable Energy has developed a control algorithm that, when used in conjunction with previously-developed wave prediction technology, helps WECs calculate the correct amount of force needed to collect the maximum energy possible, allowing the device to respond to each wave individually. The system, which was recently published in the journal Renewable Energy, doubles the energy previously collected by WECs.

Calculating Force

WECs, Prof. Weiss explains, have two parts — a fixed or weighted lower part, possibly attached to the ocean floor, and an upper section that moves up and down based on the motion of the water. The device collects energy generated by the resistance force between the parts. Unlike wind turbines or solar panels, which collect as much or as little energy as comes their way, WECs need to adjust themselves to each oncoming wave to function properly, which requires knowledge of the characteristics of the incoming wave.

If there is zero resistance between the two parts of the WEC, the upper part moves freely with the waves, and no electricity is generated, Prof. Weiss explains. On the other hand, where there is so much resistance that it suppresses movement, the device turns rigid. At both of these extremes, no energy is produced. The ideal is a happy medium based on measurements of the incoming wave.

Prof. Weiss and his fellow researchers developed a control algorithm that is responsible for setting the correct resistance force for the WEC based on the predicted wave information. A processor attached to the WEC runs the algorithm five times per second in order to determine and then implement an optimal mechanical response to the coming waves.

In the lab, the researchers have run simulations using wave data gathered from the ocean. Combining prediction technology with their new algorithm, energy collection was improved by 100 percent —double the amount of energy that WECs had collected previously.

One Second Warning

The most important piece of information is the height of the wave, says Prof. Weiss, which the WEC needs to know in advance in order to prepare. “You would think that the longer the WEC knows the wave height in advance, the better, but in a surprising finding, it turns out that a one-second prediction horizon is enough,” he says, noting that a longer prediction time does not actually improve the energy harvest.

Their findings could not only help to improve the functioning of the WECs that are already in use in places such as the East Coast of the US and the Atlantic Coast of Spain, but could help the technology become more competitive. Currently, marine energy is fifty times more expensive to collect than the market price for the energy itself — as solar and wind energy were in their infancy, says Prof. Weiss. But with the improvement of WEC structure, performance, and mass production, it could become commercially viable. “There is a lot of untapped energy in the ocean,” he adds.