China’s Great Green Grid? Capturing Wasted Wind and Solar Power for Bluer Skies and Clearer Waters

At the March 2017 National People’s Congress, Premier Li Keqiang stressed the importance of making China’s skies blue again, promising the government would accelerate upgrades on coal-fired power and integrate renewables more effectively onto the power grid. Since 2008, operating hours of coal-fired power plants have declined by over 20% and installed wind and solar capacity since 2008 has quintupled. However, as Greenpeace recently reported, the amount of electricity wasted by China’s solar and wind power sectors rose significantly in 2016. The amount of China’s wind power that failed to make it to the grid was enough to power Beijing for the whole of 2015.  To reduce this waste of clean energy, the Chinese government has initiated pilots for electricity purchases for large customers that aim to create a true national level market-based system by 2020. A market-based electricity system could effectively integrate principles from the newly revised Air Law that require clean energy measures to be included in air quality management plans and call for grid companies to initiate “green dispatch.”  However, a market-based system could also result in continued operation of inefficient thermal power plants, exacerbating air pollution, and not reducing the rates of wind and solar curtailment.  The panelists at the June 12 CEF meeting will discuss what can be done to help China move towards a more market-oriented electricity system without making pollution and water quality worse. Mun Ho (Resources for the Future) will open up the panel reviewing the challenges power grid reforms have faced in China, particularly around power dispatch. While Chris James (Regulatory Assistance Project/RAP) will talk about the potential solutions to promote green electricity dispatch in China. As the United States went through a similar transition to market-based electricity systems starting in the mid-1990s, perspectives of a state regulator are important. Eleanor Stein (Albany Law School) will discuss New York’s Reforming the Energy Vision process, and whether principles and concepts from that process might be considered for China.