SIEMENS

What role do you see for renewable energy in China?

Li Junfeng: China is investing a lot in clean energy. We currently have more than 200 gigawatts of installed hydro capacity and more than 30 gigawatts of wind, with more projects down the line. I think that by 2050 the share of clean energy in China will be much larger than many currently think it will be.

Du Xiangwan: By 2050 renewable energy, including exotic forms such as marine and geothermal energy, could account for 25 percent of China’s total energy production. If these renewable can be expanded, rather than building coal-fired power plants with the equivalent capacity, it could add up to a reduction of roughly four billion tons of CO2 emissions.

Shi Zhengrong: You may call me a dreamer, but I believe that one day China will be able to satisfy all its energy needs by means of renewable sources. It is all a question of determination. If you are determined to do something, than you should be able to achieve it — especially in China.

On the other hand, at the moment a large share of new capacity for electricity production in China comes in the form of coal-fired plants…

Shi Zhengrong: China is still a developing country. We need strong economic growth, and we need to produce affordable energy to enable this growth. However, the government does realize the need for environmental protection. There are strict regulations on emissions in place, and a lot of high technology goes into new facilities. Coal-fired plants will become cleaner, but we need some time to get it right.

Du Xiangwan: It is a fact that coal is not going to go away overnight. It is an important part of our energy mix, accounting for more than three quarters of total energy production. And new plants will be built in China. This in turn means that 100 percent renewables is an unrealistic goal. However, together with nuclear power and natural gas, renewables will at least help us to reduce the growth of CO2 emissions over time.

Li Junfeng: I agree. Gas in particular will play an important role. It is a cleaner fuel than coal, and compared with Europe and the U.S. it currently makes up only a tiny share of our energy mix. We have to catch up in this area, and we will. I am convinced that in the long run the share of coal in China’s energy mix will gradually decrease rather than increasing.

When it comes to setting the right targets for reducing CO2 emissions, which of the two should we focus on: emissions per capita or by country?

Li Junfeng: In my opinion we should base reduction targets on emissions per capita. Any other approach would be unjust. Take the examples of China and the EU. China has approximately 30 provinces. The EU has 27 states — but only about 40 percent of China’s population. Why would we count China as one country, but not the EU?

Du Xiangwan: I think it is much fairer to calculate emissions per capita, since every individual should have an equal right to draw on resources. China has a very large population. Taking aggregate figures distorts the picture.

Shi Zhengrong: This is a political question. Suntech’s objective as a private company — besides being profitable — is to make a positive overall contribution by enhancing the sustainability of energy production. Suntech has to date delivered a total photovoltaic capacity of 2.5 gigawatts. This is equivalent to five medium-sized coal-fired plants. In 2010 alone we delivered panels with a capacity of 1.5 gigawatts. And our production is rising, helping to avoid CO2 emissions all over the world.

China may be the world’s largest producer of photovoltaic panels, but only a minuscule number of them are used locally. What has to happen to make China a user rather than just a producer of PV?

Shi Zhengrong: The government has to provide subsidies so that manufacturers and investors can make a reasonable profit. There would be an additional benefit in this approach. Actually using the technology makes it cheaper through economies of scale and by fostering further efficiency gains through innovation. To reach grid parity in China, we must bring the costs down to about ten euro cents per kWh. That’s an ambitious target, but we can get there. And we have to be ambitious. In the past we only heard about the American dream. Nowadays there are many Chinese dreams.

What role do power grids play in the context of increasing the share of renewables in China?

Li Junfeng: The buildup of capacity in both wind and solar power will aggravate fluctuations; the patterns of production are bound to change extensively. This will require a more stable and more intelligent grid. China is currently making investments in this area. In addition, wind, solar, and hydro power plants tend to be in remote areas, far away from the centers of consumption, which tend to be concentrated on the east coast and in certain areas in the south. This calls for high-voltage direct current transmission lines like the one finished in 2010, which links Yunnan and Guangzhou. I understand that it draws on Siemens technology.

One element in making renewables more relevant is innovation. Do you believe that Europe and the U.S. are ahead of the game in this regard?

Du Xiangwan: Innovation is crucial to both the U.S. and China. However, I admit that we have not been particularly strong in this area. This does not mean we should emulate the Silicon Valley model. China’s problems have their own shape — and we will come up with our own ways of nurturing innovation to solve them. If we take a look at research on energy in particular, it becomes clear that China has a growing advantage. Many more new power plants are being built on our soil than anywhere else. Those who want to study new energy technology at work have a good reason to come to China.