SIEMENS

At a celebration to mark the Chinese new year on January 23, 2012, there were many more fireworks in evidence than had been the case in previous years. That’s because 2012 is the Year of the Dragon, which is said to bring happiness and success. As a consequence, the whole country expects birthrates to soar. According to popular belief, children born under the sign of the dragon are blessed by good fortune.

If forecasts produced by the United Nations are accurate, China’s population, currently at 1.34 billion, will reach 1.4 billion by around 2025. At present, with half of the country’s people already living in cities, the economy is growing at around ten percent a year and has been doing so for quite some time. Although this trend has rescued millions from poverty, it has also unleashed an immense hunger for goods, resources, and energy.

According to the International Energy Agency (IEA), oil consumption is set to rise by 70 percent between 2009 and 2015. By 2015 China is expected to account for 42 percent of global oil demand. In a similar vein, the IEA estimates that China’s power consumption rose by 200 percent in the past decade and that its water consumption could double by 2030.

For a long time, these trends took a toll on the environment. In fact, China is currently responsible for around one fourth of energy-related CO₂ emissions worldwide and is already the world’s largest producer of greenhouse gases, ahead of the U.S. According to a 2008 report by the World Wide Fund for Nature (WWF), 16 of the 20 cities with the worst air quality around the globe were Chinese. Yet the country is mindful of this problem and has begun to take action to remedy it.

“In 2006, China’s 11th five-year plan marked a paradigm shift in the country’s attitude toward sustainability,” says Martin Klarer, who is responsible for corporate strategy at Siemens China. “Environmental protection and enhanced efficiency are now major elements of China’s economic plans.”

World Champion Wind Harvester. The use of wind power is a prime example. “Less than ten years ago, there was almost no wind generation here,” Klarer explains; “but today China is the world’s largest wind energy market and home to some of the world’s largest wind power companies.” What’s more, this is a growing market. According to the newspaper Shanghai Daily, in 2011 China generated some 70 terawatt-hours (TWh) — 70 billion kilowatt-hours (kWh) — by means of wind power, an increase of 40 percent over the previous year.

China is planning to install wind turbines with a total capacity of 150 gigawatts (GW) by 2020. That’s equivalent to almost the total combined renewable and conventional installed capacity in Germany. It is also worth remembering that at the end of 2006 China’s wind power capacity was a mere 2.6 GW.

In other words, wind energy is a major market of the future in China. As the world leader in offshore wind power installations, Siemens is thus looking to capitalize on this expansion, not least because of the huge potential in this segment of the industry. With shallow waters extending many kilometers from its coastline, China offers ideal conditions for offshore wind farms. With this in mind, in spring 2011 Siemens opened a facility that produces nacelles for wind power plants in close proximity to an existing rotor blade plant. Located close to Shanghai, right on the East China Sea, the facilities have an annual capacity equivalent to a generating output of 500 megawatts (MW).

“We’re supplying not only China but practically the entire Asian market as well,” says Victor Li, head of turbine production at Siemens, China. “For now, we’re producing 2.3 MW turbines; but later we’ll build 3.6 MW models and even 6 MW ones.” The fruits of this labor are already visible in Jiangsu province on China’s east coast, where Siemens has installed an offshore wind farm with 21 wind towers and a total output of 50 MW. “We also have firm orders from other countries, including Thailand,” adds Bjarne Joergensen, head of the rotor blade plant.

Traditional Hydroelectricity. Whereas the use of wind power is a recent phenomenon, hydroelectricity has been an integral part of China’s energy mix for 100 years. A century ago Siemens installed generators with a combined output of 480 kilowatts (kW) in the country’s first hydroelectric plant, located in Yunnan province in southwest China. It was the start of a unique boom. Today China has more hydroelectric facilities than any other country. With a combined output of 197 GW, these plants contribute some 15 percent of the power consumed in China. According to the China Electricity Council, around 4,700 TWh were consumed in 2011 — almost eight times Germany’s annual energy requirements.

Nonetheless, the lion’s share of the power consumed in China’s huge cities is still generated by coal-fired plants. Along with the rapidly rising tide of traffic, this is one of the major causes of the country’s serious smog problems. “The challenge is that the majority of China’s hydropower is generated in remote southwest provinces, hundreds of kilometers from the nearest population centers,” says Klarer. The remedy is to use high-voltage direct-current transmission lines. These low-loss lines can transmit huge amounts of power over hundreds or thousands of kilometers.

One such HVDCT line built by Siemens and electricity provider China Southern Power Grid (CSG) has been operating since 2010. It supplies the major cities of Guangzhou and Shenzhen in the southern Chinese province of Guangdong with 5,000 MW of clean power generated by hydropower plants in Yunnan, some 1,400 kilometers away. Compared to the emissions associated with coal-fired generation, the region produces 30 million metric tons less CO₂ a year thanks to the new line.

China’s utilities are planning a crop of additional HVDCT lines, 14 of which are due for completion by 2015. Two of these are being built by Siemens, CSG, and other Chinese partners. Featuring transformers, converters, and other key Siemens components, these two lines will transmit an additional 11,400 MW of clean power to Guangdong from 2013 onward.

Exploiting Savings Potential at present, mega cities such as Beijing and Shanghai can only dream of tapping any form of clean power in quantities such as these. They still rely largely on electricity generated by coal-fired plants. Here, ways of bringing about a lasting reduction of CO₂ emissions include improved generating efficiency, smarter usage of power, and demand reduction strategies — primarily in industry, but also in private households. As of 2008, for example, all Chinese homes have been able to purchase subsidized energy-saving bulbs for a tenth of their original price. In the first year of this campaign, 62 million low-energy lamps were sold; the figure has since exceeded 120 million. In Beijing alone, there are 15 to 20 million energy-saving bulbs in use thanks to this campaign. Compared to conventional incandescent bulbs, this means savings of up to one billion kilowatt-hours per year.

When it comes to industry, however, the authorities have opted for binding legislation. This is because industrial electric motors are the largest consumers of power in China. According to China’s National Development and Reform Commission (NDRC), they account for around 60 percent of domestic power consumption. “Less than three percent of industrial motors in China carry the Chinese energy efficiency rating of 2 or better,” says Du Bin, product manager at Siemens Drive Technologies in China.

Yet this is set to change. Since July 2011, all industrial motors sold in China must have an energy efficiency rating of at least 2. Potentially, this represents a massive reduction in costs. “If all the industrial motors in China were swapped for more energy-efficient models, consumption would fall by around 60 TWh a year. CO₂ emissions would decrease by 50 million metric tons,” says Du Bin. In collaboration with colleagues in Germany, Siemens Drive Technologies in China has developed a more efficient electric motor for the Chinese market, where it is already being manufactured. “Our motor is designed to be inexpensive, robust, and very easy to operate. Because it also conforms to the standards of the International Electrotechnical Commission (IEC), it is sure to be marketed worldwide,” adds Du Bin.

There is also huge potential for improving the efficiency of China’s coal-fired power plants, which cover around four fifths of the country’s electricity needs. Take Shanghai, for example, with its population of 23 million. Here, daily power consumption can rise to as much as 20 GW and is currently increasing by around 1 GW every year. In order to provide a sustainable response to this huge demand, city authorities have turned to new technology. Here, projects include the coal-fired Waigaoqiao No. 3 power plant. With turbines and generators from Siemens, the plant boasts a net efficiency of 46 percent, one of the highest in the world for a facility of this type. This plant, which was commissioned in 2008, consumes around 700,000 metric tons per year less than a standard Chinese coal-fired plant; its corresponding CO₂ emissions are around 1.8 million metric tons lower.

China’s most efficient combined cycle power plant, which also relies on Siemens turbines and generators, is located nearby. The facility, which is operated by Huaneng Shanghai Combined Cycle Power Co., LTD, has an output of 1,200 MW and an efficiency of 58 percent. Commissioned in 2006, its job is to cover the huge peaks in demand that can rock Shanghai’s power grid on particularly cold or hot days. “Compared to a coal-fired plant, the advantage of a combined-cycle power plant is its enormous flexibility,” says the plant’s general manager XieDeyu. “The plant comprises three blocks, each with a rating of 400 MW. We can ramp up and ramp down any of these blocks fast enough to cover peaks in demand almost immediately. Last year alone, we had to deal with over 310 such incidents. If we didn’t have the combined-cycle power plant, we’d probably need to operate more coal-fired plants for backup — and that would result in much higher emissions.”

Another flexible option for buffering fluctuations in supply and demand would be to exploit the batteries of electric cars as an intermediate storage facility, particularly when cities such as Shanghai start to make greater use of variable sources of power such as wind energy. At times of either peak demand or low wind, this backup supply could then be reintroduced to stabilize the grid. Obviously, such a system would require a much larger fleet of electric vehicles than is currently available. However, the authorities are now planning to put as many as one million hybrid and electric vehicles on Chinese roads by 2015. To help achieve this ambitious target, work has already begun to provide the requisite infrastructure. At the end of 2011, for example, Siemens installed 140 charging stations for electric cars in Shanghai.

Sustainable City. “China has covered a lot of ground in terms of improved efficiency,” says strategy expert Klarer, “but it still faces big challenges, particularly in metropolitan areas, where the population is set to grow by an additional 350 million over the next 15 to 20 years.” Forecasts indicate that by 2025 there will be around 220 cities with more than one million inhabitants. Many of these urban areas will mushroom out of nothing. “To ensure the greatest possible sustainability, these cities will require integrated holistic concepts rather than the discrete isolated solutions implemented in the past,” Klarer adds. One such concept is currently being realized just outside Tianjin, a port near Beijing. Tianjin Eco-City will provide homes and work for around 350,000 people from 2020 onward. It should also provide China’s urban planners with an answer to the most pressing question of their time: how to build a sustainable city on the basis of a reproducible model under realistic conditions.

Such a project looks viable. Around 20 percent of the Tianjin’s electricity is to come from renewable sources; water consumption will be half of today’s level; and 90 percent of traffic will be based on green forms of mobility such as bicycles, public transport, and electric cars. Naturally, the buildings will have intelligent management systems and good insulation.

At the same time, the new eco-city will serve as a living research experiment. It will be possible to make continual adjustments designed to improve the overall efficiency of the project. In order to advance the cause of green urbanization, the project company Sino-Singapore — a joint venture between the governments of China and Singapore — intends to establish a joint venture with Siemens. The aim is to harness a wide range of state-of-the-art technologies, develop and demonstrate future-oriented technologies, and create a vision that will make Tianjin Eco-city a sustainable and replicable city model for the rest of China. Last and by no means least, a project like Tianjin Eco-City underscores China’s continuing commitment to enhanced efficiency — and that’s an achievement that is much too precious to be left to the vagaries of the Chinese zodiac.