Category Archives: Energy

Too Innovative To Be True

Traffic-straddling busTHE GIANT TRAFFIC-STRADDLING bus that caught this Bystander’s somewhat skeptical eye last year (see above) has gone the way of many an idea that was too innovative for its own good. Nowhere.

Technical and financial shortcomings seem to have done for it, according to press reports. Latest reports say the test track is being dismantled.

Last year, shortly after the (very) short test run of a prototype Transit Elevated Bus (TEB) in Qinhuangdao, the Beijing News reported that the main investment promotor for it was Huaying Kailai, an asset management company blacklisted in 2015 for conducting illegal finance activities. The Global Times said the firm, part of the Huaying Land Group, also ran a peer-to-peer financing scheme that promised high returns but risked running out of cash.

Claims of cooperation agreements between the bus’s maker, TEB Technology Development, and municipal governments appear to have been as spurious as purported orders from three countries in Latin America.

Update: Police have arrested 32 people in connection with the failure of the TEB, including the CEO of TEB and founder of Huaying Kailai Asset Management, Bai Zhiming, and 31 Huaying Kailai employees.

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China Gets Its UK Nuclear Prize, Probably

THE UNITED KINGDOM’S decision to go-ahead with three nuclear power plants, the first at Hinkley Point, has had a somewhat surprisingly gruff welcome from state media.

Shortly after taking office in July, UK Prime Minister Theresa May ordered a second look at the projects, which were approved by the previous administration. This was to include cost and environmental concerns but also a security review of China’s involvement, which includes part-financing new reactors at Hinkley Point and Sizewell, both to be built and operated by France’s EDF, but also leading the construction and operation of a reactor at Bradwell to indigenous Chinese designs.

“However, in spite of the approval, China-phobia sentiments continue to hover and could possibly introduce more troubles as construction of the project gets underway, a Xinhua commentary thundered. “It is reported that while announcing the go-ahead, Theresa May has also promised ‘significant new safeguards’ to make sure that investment from China does not threaten national security. Of course, the British leader’s misgivings make little sense.”

The new safeguards give the British government a veto over sales of full or partial ownership of the reactors both while they are being built and then operated, and institutes national security reviews for future critical infrastructure projects, a practice that is common in most large economies, including China.

There had been dire warnings from the Chinese side when May announced her review that abandoning the projects would end the ‘golden era’ of Sino-British relations championed by her predecessor David Cameron and his finance minister, George Osborne.

“Let us hope that London quits its China-phobia and works with Beijing to ensure the project’s smooth development, Xinhua’s commentary continued.

Its testiness underlines the uncertainties that still surround the projects. China is desperate that Bradwell goes ahead to give it a key early sale to a developed nation of its still untried Hualong One reactor. Beijing hopes that will lead the way to a global export market for what a senior official at China General Nuclear Power estimates will be some 200 nuclear power plants.

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The Global Greening Of China

CHINA HAS THREE imperatives when it comes to climate change: to use the issue to cement its growing position as a world power; to deal with its domestic pollution problems so that they don’t become a political issue that could challenge the Party’s primacy; and to establish industrial leadership in ‘green’ technologies including renewable fuels.

The symbolism of Presidents Xi Jinping and Barack Obama jointly ratifying the Paris climate change agreement (Cop 21) will not be lost domestically or internationally. Xi will take the opportunity of the G20 meeting in Hangzhou to reinforce that message that China is at the centre of world affairs and that, as state media put it, developed and emerging countries are “in the same boat, with China charting the course ahead this time”.

The move by the world’s two biggest polluters is clearly a significant step for the climate change deal, which needs 55 nations accounting for at least 55% of the world’s emissions for it to come into effect. China and the United States raise the percentage at a stroke to more than 40% from 1%. It just now needs the EU and a couple of other countries to follow suit to get the deal over the line.

Beijing’s Paris accord commitment is to cut its carbon emissions per unit of GDP by 60-65% from 2005 levels by 2030 and to increase non-fossil fuel sources in primary energy consumption to about 20%. While those targets don’t necessarily mean a cut in absolute emissions levels, it will slow their growth meaningfully. China committed at Paris that they would peak in ‘around 2030’.

The large steps China has taken in energy efficiency and the rebalancing of the economy away from industrialisation and towards more services will aid it in hitting those goals. Becoming more of a low-carbon economy will also help achieve its domestic goals of lessening pollution, a perpetual point of popular perturbation and protest. Environmental NGOs are kept on a short leash for fear they are a seed of political organisation.

At the same time, China has developed into the world’s largest market for hydropower, nuclear, wind and solar energy and increasingly aims to make those indigenous industries, serving both the ambitions of developing low-carbon urbanisation and bringing economic development to some of the poorest but also windiest and sunniest provinces. As relatively new industries, there is also more opportunity for China’s new found desire to be innovative to flourish, as well as for its manufacturers to find new export markets for wind turbines, solar panels and even nuclear reactors.

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China Eyes Global Nuclear-Reactor Export Market

 

A model of a Hualong One (HPR1000) nuclear reactor

An export that glows in the dark: a model of a Hualong One (HPR1000) nuclear reactor

THE REAL PRIZE for China in the United Kingdom’s nuclear industry is not Hinkley Point but the plant at Bradwell that is planned to come after — and all the foreign sales of its new nuclear reactors that may come after that.

China, though the state nuclear company China General Nuclear Power Group (CGN), will finance one-third of the £18 billion ($23.5 billion) cost of Hinkley Point C, which will be the UK’s first new nuclear plant in decades. The other two-thirds and the technology will be supplied by the French utility EDF.

The deal gives EDF a showcase that it hopes will offset setbacks in projects in Finland and France for its latest design of reactors, but CGN gets a toehold in western Europe. Bradwell would be built using an indigenously designed Chinese reactor.

It would also be a key early sale in what could be a global export market for, at best guesstimate, at least 130 nuclear power plants. At $15 billion-25 billion each, that adds up to a decent chunk of change. China’s nuclear industry has its eyes firmly on the prize.

Beijing has enthusiastically pursued nuclear power domestically as a low-carbon energy source. As of March, there were 33 nuclear reactors operating in the country, with a total capacity of 28.8GW. A further 22 were under construction with a capacity of 22.1GW. The goal is for nuclear to generate 6% of China’s electricity by 2020, against 2% now.

Other countries are warier of nuclear power, and in particular since the accident at Fukushima in Japan in 2011 (which also caused a temporary suspension of new plant building and approvals in China while new nuclear safety rules were drawn up).

Earlier this month, the new British government of prime minister Theresa May put Hinkley Point on hold for further review.

First, there are the perennial environmental and safety concerns about nuclear energy.

Second, there are concerns about the economics of the deal. The UK government gets out of the upfront building costs and plugs a looming energy shortfall, but it has had to guarantee a price for the electricity Hinckley Point will produce that is twice the current wholesale price — and to do so for 35 years.

In the complex economics of energy pricing that may not prove to be as expensive in the long term as it looks, but the sums — and their underlying assumptions — certainly warrant a second look

Third, May is said to be concerned about China’s involvement, both on grounds of national security and because she has long been critical of the ‘gung-ho’ approach to Britain’s welcoming of Chinese inward investment championed by her predecessor administration of David Cameron and in particular by his finance minister George Osborne.

Osborne and May have long had a distrustful political relationship. Replacing him as finance minister was one of her sets of appointments.

State media have been admonitory of the last-minute delay, saying that cancellation of Hinkley Point could threaten what President Xi Jinping called the ‘Golden Era’ of China-UK investment relations during his state visit to the UK last year. Beijing’s ambassador to Britain, writing in the Financial Times this week, called the times a ‘crucial historical juncture’.

In October last year, before the ‘Brexit’-induced change of prime minister, the UK had reached a strategic investment agreement with China covering three nuclear power plants:

  • Hinkley Point C;
  • an investment in Sizewell that will also use French EPR reactor technology; and
  • Bradwell, whose construction China was expected to lead and which will use Hualong One reactors.

The Hualong One has evolved from upgraded Chinese versions of the French 900MWe class pressurised water reactors already widely in use in China. CGN has developed it jointly (at Beijing’s direction) with China National Nuclear Corp. (CNNC).

The Hualong One is considered to be a ‘third-generation-plus’ reactor, which means it complies with the post-Fukushima safety requirements. It is entirely Chinese designed and intended for sale in international markets as well as domestic deployment.

A Hualong One nuclear reactor under construction at FuqingSix are to be built in China, according to CGN. The International Atomic Energy Agency lists three as under construction. The one in Fuqing in Fujian province is shown to the left.

Internationally, two are to be built in Pakistan and a third is planned for Argentina. CNNC chairman Sun Qin has been quoted as saying that China plans to build 30 nuclear power units in countries along its “One Belt, One Road” initiative by 2030.

Bradwell, though, would be the first build in a developed economy. As such, it would be a highly prized sale that China does not want to let slip through its grasp.

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Straddling Buses And Wireless Trams

 

Traffic-straddling busA GIANT TRAFFIC-STRADDLING bus (seen above) has caught the world’s attention, but it may be a different public transport technology that has the lasting impact.

The day after a prototype 2 metre-high Transit Elevated Bus made its inaugural test run along 300 metres of track in the northeastern city of Qinhuangdao in Hebei province, China’s first fully indigenous super capacitor (‘supercap’) tram rolled off the production line in Zhuzhou in Hunan province.

Both tick several boxes for China: road-congestion reduction, green transport that will lower carbon emissions and cutting-edge technology.

The electric-powered Transit Elevated Bus can carry 300 passengers, with, its manufacturers say, up to four of its 21 metres long by 7.5 metres wide units eventually being able to be strung together.

It runs along a track that can be laid on an existing road and sweeps over the traffic below (or at least over vehicles low enough to fit under) at speeds, it is said, that will eventually reach up to 60 kilometres per hour. It is touted as being like a subway system without the need to build the tunnels, thus reducing construction costs to a fifth of that of constructing a new subway line.

CRRC ZELC supercapacitor tramThe super capacitor tram  (seen above) does not have the futuristic look of the elevated bus. It looks like, well, a tram. Built by the electric motor division of the giant state-owned rolling stock manufacturer CRRC Corp., ZELC, the tram can carry up to 380 passengers and travel at 70 kilometres per hour. Its key feature is that its batteries can be fully powered in 30 seconds — i.e. while it is stopped to take on or put off passengers — so there is no need to install unsightly fixed lines above the track to provide the power.

The technology is at least a decade old and lets trams run for up to 5 kilometres on a single charge. Centenary-less supercap trams using technology from Germany’s Siemens are already running Guangzhou. Nanjing will be next. China’s cities have 5,000 kilometres of tram track with plans to have half as much again by 2020.

But why bother with tracks at all? Super capacitors can also be used to charge electric buses. ZELC has already developed a prototype in Ningbo, a bus that still travels on the road rather than over it.

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It Is An Ill Wind That Blow’s China’s Nuclear Industry No Good

CHINA’S STATE-OWNED heavy engineering firms are getting a liking for European renewables. China General Nuclear (CGN) Corp. has beaten out several rivals to acquire a controlling stake in three U.K. wind farms being sold by the French utility EDF.

This follows China Three Gorges Corporation acquisition of wind-generation capacity in Spain and Portugal to add to that it has in Pakistan. The State Administration of Foreign Exchange (SAFE), which also supervises CGN, owns 49% of the portfolio of wind assets belonging to the Norwegian state owned electricity company, Statkraft. This stake is held through SAFE’s U.K. investment arm, Ginko Tree Investment.

CGN, which generates more than half of China’s nuclear energy and was known as the China Guangdong Nuclear Power Group until last year, paid an estimated $157 million for 80% of the three wind farms. EDF will retain the remaining 20% and continue to operate the facilities.

The three farms, all in eastern or north eastern England, are CGN’s first significant acquisition of onshore wind generating capacity outside China. It has a small interest in an Australian wind farm but set up a subsidiary earlier this year to acquire off- and onshore wind farms and solar projects in Europe. The U.K. government runs a subsidy scheme that requires energy utilities to buy a certain amount of electricity generated by renewables, which makes U.K. projects an attractive investment.

The generating capacity that CGN will be acquiring is relatively modest at 72 megawatts, sufficient to serve only 40,000 homes. By way of comparison, the group has installed generating capacity of some 7 gigawatts of solar, hydro and wind power in China plus 11.6 gigawatts of nuclear power.

Not that China’s nuclear companies are turning their back on nuclear despite industry’s post-Fukushima hiatus. CGN has another 3.9 gigawatts of capacity under construction in China and is involved in the negotiations over Hinkley Point C, a new $40 billion nuclear power plant EDF is planning to build in the west of England. That would be the first nuclear power plant built in Britain in a generation. CGN and China National Nuclear Corporation also want to build another nuclear plant in eastern England that would controversially use a Chinese built reactor.

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A Beijing Boost For China’s Electric Vehicle Makers

CHINA SEES ELECTRIC vehicles as the way to leapfrog its way to leadership of the global car industry. Promoting green technologies will also help the country tackle its widespread and worsening pollution, even though the impact of electric vehicles will mostly be in mitigating the problem from getting worse.

Despite government backing since 2009, production is currently modest, to say the least. The goal is to be building half a million electric vehicles a year by the start of 2016 and twice that number by 2020.

To that end, the government has announced an industrial-policy boost. Central government departments and municipal administrations will have to allocate a third of their annual vehicle procurement to “new energy” vehicles. That covers hybrids as well as vehicles powered by hydrogen cells, but in practice means electric vehicles. Local authorities are also instructed to install charging stations — one for each electric vehicle on the road.

Some financial incentive for officials to follow these new directives seem inevitable, given the increasing pressure on local-authority budgets now land sales are a less readily available honeypot. Any subsidies will have to be carefully structured to ring fence them from any potential international trade disputes.

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