Wind power is expected to play a key role in China’s net zero ambitions, according to global natural resources consultancy Wood Mackenzie’s new research, China Wind Power Outlook 2021-2030.
The country will have a total grid-connected wind capacity of 689 gigawatts (GW) by 2030, accounting for 67% of global capacity.
'Stimulated by China’s target of 1,200 GW of wind and solar set for 2030, 408 GW of new capacity will be added from 2021 to 2030. Onshore wind comprises 82% of the total during the outlook, with an average annual capacity of 33 GW,' said Wood Mackenzie principal analyst Xiaoyang Li.
Due to favorable wind conditions and policies, the northern regions of the country will continue to dominate the onshore wind sector.
State-owned developers are signing GW-level development contracts directly with local governments in Inner Mongolia, Hebei, and the Shanxi provinces, where new-developed renewable energy bases are fueling the fast growth.
Noting that a substantial volume of aging turbines with legacy technology installed in the last decades represents a good opportunity for repowering activities apart from new projects, Li said relevant policies to address the feasibility and profitability of repowering in China are needed to unleash this repowering market potential, which is expected to hit a capacity of 24 GW by 2030.
-Favorable policies and healthy pipeline to support outlook
WoodMac recalled a series of policies released to support sustained wind market growth following China’s 2060 target announced in September 2020.
'These include the 2030 renewable capacity target, annual renewable portfolio standard (RPS) targets, and benchmarked on-grid tariffs to stabilize onshore wind project profitability after subsidies ended in 2020,' it said.
There are sufficient onshore wind projects in the pipeline to support China’s 10-year outlook. The number of renewable bases more than tripled from 25 to 78 from the second half of 2020 to the same period of 2021, amounting to 260 GW of total capacity being planned and under construction across 14 provinces.
Established onshore wind supply chain and larger-scale wind turbine models will allow the onshore wind power levelized cost of electricity to decrease by 46% from 2021 to 2030 and drop below coal power’s on-grid tariffs in 2022.
-Intense competition in carbon-neutral arena
According to the research, wind power is not the only winner under the national target. It is also challenged by lower-cost solar power in the post-subsidy era.
“The low initial investment for solar projects contributes to a low market-entry threshold and more diversified market players compared to wind projects, which are preferred by state-owned developers,” WoodMac said.
Pointing to the rising importance of hybrid projects, the research underlined the Chinese government’s efforts to encourage the development of integrated wind-solar-storage-hydro-thermal projects to alleviate the pressure on the grid network and to support substantial renewable energy online.
By Sibel Morrow