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Law on Renewable Energy in Pipeline

China's continued power shortage is pushing the government to take additional action, including legislation, to promote the development of renewable energy.

State entities are drafting a law that will make it compulsory for power grid companies to buy electricity generated by renewable energy sources such as water, wind, solar, biomass, geothermal and oceans, and all end-users will share the costs, according to Li Junfeng, secretary-general of the Chinese Renewable Energy Association.

The draft is now being circulated among ministries and big state-owned corporations for review.

A revised draft will be submitted to the National People's Congress Standing Committee this month for discussion, Li told China Daily. Li hopes the law will be passed before May next year.

In June this year, a special conference was held to collect international opinions on the proposed law. The draft is also accessible on the Internet.

"We have spent a lot of time and energy learning from the successes and failures of our partners in Europe and around the world. We believe this law can start a renewable energy revolution in China," Li said.

China has been slow to develop renewable energies because they are more expensive than conventional energy sources. For example, it takes 0.35 yuan (4 US cents) to generate 1 KW/H of electricity from coal while wind-generated electricity costs about 0.50 to 0.60 yuan (6 to 7 US cents) per KW/H.

However, sharp increases in energy demands leave China no choice but to speed up the exploitation of renewable energy.

Last year, China's gross energy consumption reached the equivalent of 1.7 billion metric tons of coal, an increase of 13 percent over 2002.

"Soaring oil imports, wild fluctuations in international oil prices, the mounting costs of extreme weather events and heightened concern over energy security mean that China's commitment to renewables at this time is crucial," warned Steve Sawyer of Greenpeace International, during a four-day Forum on Wind Energy held earlier this month in Beijing.

"The potential to increase renewable energy production in is vast," Li said. "Renewable energy is playing a growing role in the Chinese energy supply and has become a significant future energy source."

On June 30 of this year, the State Council approved a significant energy policy document: the Outline of China's Medium and Long-term Energy Development Program (2004-2020).

According to Li, China's goal to develop renewable energy is to increase its installed renewable energy generating capacity to 60 gigawatts by 2010, about 10 percent of the total power capacity, and 121 gigawatts by 2020, 12 percent of the total.

By 2020, China's gross energy consumption is estimated to reach 3 billion metric tons of coal equivalent per year.

Li said China's energy mix also needs restructuring. It depends too heavily on coal, which accounts for 67.1 percent of total consumption. Oil accounts for 22.7 percent, with 970 million tons imported.

At present, renewable energy only accounts for 5 to 6 percent of China's total power supply.

Environmental degradation also provides impetus to look to clean alternative energy sources.

"The impacts of climate changes on China are truly frightening, demanding urgent action. More than 60 percent of Chinese glaciers are anticipated to disappear by 2050, threatening the fresh water supply for more than 250 million Chinese," said Yu Jie, director of Greenpeace's Beijing office.

The Outline of China's Energy Program states that the government will "enhance environmental protection and strive to reduce the impact of energy production and consumption on the environment."

(China Daily October 21, 2004)

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