0105 Ni Weidou PPT new - Stanford University

China’s Energy— Challenges and Strategy

Prof. Ni WeidouProf. Ni WeidouTsinghua University

Chairman of Steering Committee of

Tsinghua-BP Clean Energy Research and Education Centre

Member of Chinese Academy of Engineering

Chairman of Science and Technology Commission of Ministry of Education

If today’s trend of utilization of fossil fuel will continue (BAU technology), we are running out of atmosphere faster than we’re running out of fossil fuels.

Terrorism doesn’t threaten the viability of the heart of our high technology life-style, but energy really does.

Five challenges China is facingFive challenges China is facing

•• Enormous energy demandEnormous energy demand

•• Shortage of liquid fuelsShortage of liquid fuels

•• Severe environmental pollutionSevere environmental pollution

•• Greenhouse gas emissionsGreenhouse gas emissions

•• Rural energy supplyRural energy supply

GDP per capita comparison of countriesGDP per capita comparison of countries

42318

31707 30845 2895926071

12068

5462

1000

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

Japan Germany America France Singapore Korea Theaverage

China

Notes: Prices of 1995

Sources:《日本能源经济统计手册》（2002）

( Unit: US dollars)

Per capita energy consumptionPer capita energy consumption

4.07 4.11

8.14

4.35

5.74 5.69

0.698

3.85

0123456789

Japa

nGerm

any

America

France

Singap

oreAus

tralia

China EU

Notes: Data in 1999.

Sources:《日本能源经济年鉴》(2000)

( Unit: ton)

Huge Pressure on Demand and SupplyHuge Pressure on Demand and Supply

In 2003, total production 1.603 billion tce, 11% of

world total，rank 3rd

Hydro280 billion kWh, 10.8% of world total, rank 4th

NG35 billion m3, 1.3% of world

total, rank 17th

Raw coal1.667 billion ton, 33.5% of world total, rank 1st

Oil170 million ton, 4.6% of world total, rank 5th

(Units: 108 ton)

Production of Raw CoalProduction of Raw Coal

Annual increase Annual increase 45 mil. ton45 mil. ton, average increase rate , average increase rate 4.4%4.4%

5.47

2.9

8.3

16.67

2003

4.01.1Small Mines

2.01.6State-owned Local Mines

4.83.5State-owned Key Mines

10.86.2Total

19901980Year

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

1949

1952

1955

1958

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

Unit: 104 t

Production of OilProduction of Oil

Average increase rateAverage increase rate 14.4%14.4%

Found DaQing

Found ShengLi

Found RenQiu

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003

Unit: billion m3

Production of NGProduction of NG

Average increase rateAverage increase rate 16.3%16.3%

0

0.5

1

1.5

2

2.5

3

3.5

4

1952 1955 1958 1961 1964 1967 1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003

Installed Capacity in 1949: 1.85GW

From 1996, total installed capacity ranked 2rd in the world. 200From 1996, total installed capacity ranked 2rd in the world. 2005, about5, about430 GW430 GW

Power SectorPower Sector

Installed Capacity in 1978: 57.12GW

Installed Capacity in 1987: >100GW



By the end of 2003, Installed capacityBy the end of 2003, Installed capacity 391GW391GW

Coal fired Hydro Nuclear Renewalbes

Coal fired290GW,74.1%

Hydro94.89GW,24.23%

Renewables550MW,0.14%

Nuclear6.19GW, 1.58%

Power Mix of China in 2003Power Mix of China in 2003

From 2000, shortage of energy supply becomes more and From 2000, shortage of energy supply becomes more and more severe. Though the domestic average energy more severe. Though the domestic average energy production increase rate production increase rate –– 14.35%, and oil import increase 14.35%, and oil import increase rate rate –– 11.7%, the supply of energy is still the big problem11.7%, the supply of energy is still the big problem

The supply of energy is the big problemThe supply of energy is the big problem

Coal (China) = Oil + NG (World)Coal (China) = Oil + NG (World)Oil + NG (China) = Coal (World)Oil + NG (China) = Coal (World)

Consequently, serious pollution and low efficiencyConsequently, serious pollution and low efficiency

World Energy Mix Energy Mix in China

67%

23%

3% 7%

Coal Oil NG Hydro

27%

37%

24%

6% 6%

Coal Oil NG Hydro Nuclear

Energy Consumption StructureEnergy Consumption Structure

Coal, 16.36, 47%

Gas, 6.9, 20%

Hydro, 7.23, 21%

Nuclear, 3.61, 10%

Renewables,

0.55, 2%

The constituent of Power SectorThe constituent of Power Sector

Hydro,9489,

24.23%

Coal,29000,74.05%

Renewables, 55,

0.14%

Nuclear,619,

1.58%

2001 World Power Mix 2003 China Power Mix

(Unit: 100GW)(Unit: 100GW) (Unit: 10MW)(Unit: 10MW)

Coal Coal –– 1636 GW, 47%1636 GW, 47%Gas Gas –– 690 GW, 20%690 GW, 20%

Nuclear Nuclear –– 361 GW, 10%361 GW, 10%

Coal Coal –– 290 GW, 74%290 GW, 74%Hydro Hydro –– 95 GW, 24%95 GW, 24%

471392 381

0

100

200

300

400

500

1978 2000 2003

Specific Consumption

Improvement of technologyImprovement of technology

471 471 381 381 gcegce／／kWhkWh 8.8% 8.8% 6.15%6.15% 9.64% 9.64% 7.5%7.5%

8.8

6.15

0

10

1978 2003

Internal utility needs

9.64

7.52

0

10

1978 2003

Transmission loss

The main problems China is facingThe main problems China is facing

Constraints of domestic resources (reserves)Constraints of domestic resources (reserves)

Huge investment (up to 2020, about 1000 billion $)Huge investment (up to 2020, about 1000 billion $)

Energy securityEnergy security

Low efficiencyLow efficiency

Severe environment impactSevere environment impact

Constraints of Domestic Resources (Reserves)Constraints of Domestic Resources (Reserves)

Though the resource is abundant, but at present resource Though the resource is abundant, but at present resource

suitable for exploitation only aboutsuitable for exploitation only about 100 billion ton100 billion ton

CoalCoal


OilOilIn 2004In 2004

•• Domestic production Domestic production –– 170 mil. t (3.4 mil. bbls/d)170 mil. t (3.4 mil. bbls/d)

•• Consumption Consumption –– 290 mil. t290 mil. t

•• Reserve / exploitation ratio 12~15, very critical (World averageReserve / exploitation ratio 12~15, very critical (World average ~40 )~40 )

•• Import 120 mil. t (2.4 mil. bbls/d), import dependence Import 120 mil. t (2.4 mil. bbls/d), import dependence –– 40%40%

By the year 2020By the year 2020

•• Domestic production Domestic production –– 200 mil. t200 mil. t

•• Consumption Consumption –– 400~500 mil. t400~500 mil. t

•• Import dependence Import dependence –– more than 60%more than 60%


Hydro PowerHydro Power

•• Resource Resource –– rank 1st in the world, ~500GWrank 1st in the world, ~500GW

•• Location Location –– mainly in remote westmainly in remote west--south areas, far from load centerssouth areas, far from load centers

•• Ecological uncertaintyEcological uncertainty


The exploitation of hydraulic resources by areasThe exploitation of hydraulic resources by areas

East Central West0

5000

10000

15000

20000

25000

30000

35000

Exploitable Installed Capacity

Development rate:

61%

Development rate: 35.7%

Development rate: 12.6%

Unit: 10MW

11.91

14.6

1

16.4

2

0.151.080.46

2.430.355

2.0440.998

2.720.996

3.104

1.6

2.86

0

2

4

6

8

10

12

14

16

18

Coal Oil NG Hydro Nuclear Renewalbes

200320102020

Unit: 108 tce


Production target by the year 2010 and 2020Production target by the year 2010 and 2020


Energy Mix by the year 2010 and 2020Energy Mix by the year 2010 and 2020

Oil23% Coal

67%

Nuclear1%

Hydro6%NG

3%

2003New

Energy4%

Oil21%

Coal59%

Nuclear1%

Hydro9%

NG6%

2010

NewEnergy

6.5%

Oil20.7%

Coal51.0%

Nuclear3.2%

Hydro10.0%

NG8.6%

2020


Speed up the Nuclear powerSpeed up the Nuclear power

Nuclear PowerNuclear Power

•• 2003 2003 –– 6.2 GW6.2 GW

•• 2020 2020 –– 40 GW40 GW

•• More than 2 GW increase annuallyMore than 2 GW increase annually

•• Development of domestic 1000 MW unit (advanced PWR)Development of domestic 1000 MW unit (advanced PWR)


Speed up the NG exploitation and import of LNGSpeed up the NG exploitation and import of LNG

•• West to east pipeline West to east pipeline –– 12 billion Nm12 billion Nm33

•• 2003, total production 35 billion Nm2003, total production 35 billion Nm33

•• 2020, domestic production 120 billion Nm2020, domestic production 120 billion Nm33, consumption 200 , consumption 200 billion Nmbillion Nm33

•• Already signed contract with GE, MHI and Siemens for Already signed contract with GE, MHI and Siemens for purchasing 45 units of Fpurchasing 45 units of F--class gas steam combined cycles (380 class gas steam combined cycles (380 MW each). Total consumption of NG MW each). Total consumption of NG –– 16 billion Nm16 billion Nm33. Is it the . Is it the right way for NG utilization?right way for NG utilization?


•• China is abundant in renewable energy China is abundant in renewable energy –– wind, solar and wind, solar and biomassbiomass……

•• Wind energy, in shore Wind energy, in shore –– 254 GW, off254 GW, off--shore shore –– 700 GW700 GW

•• Biomass Biomass –– 500~600 mil. tce (but highly scattered)500~600 mil. tce (but highly scattered)

Renewable energyRenewable energy


•• Installed capacity of wind power Installed capacity of wind power –– 700 700 MWMW

•• 170 thousand small wind mills, total 170 thousand small wind mills, total capacity about 20 MWcapacity about 20 MW

•• By the year 2020 By the year 2020 –– 20 GW, about 30 20 GW, about 30 times increasetimes increase

•• Domestic production: 600, 750 kW units Domestic production: 600, 750 kW units have been installed in large scale; 1.2 have been installed in large scale; 1.2 MW units are being tested now.MW units are being tested now.

Renewable energy (Wind)Renewable energy (Wind)


•• Solar heat collectors Solar heat collectors –– high high technology, 92~95% absorption ratetechnology, 92~95% absorption rate

•• 52 mil. m52 mil. m22, 40% of world, 40% of world’’s totals total

•• Dominant in the world marketDominant in the world market

•• Huge potential of energy Huge potential of energy conservation (In combination with conservation (In combination with heat pump technology)heat pump technology)

Renewable energy (Solar)Renewable energy (Solar)


0

10

20

30

40

50

60

2002 2010 2020 2030 2040 2050

(Uni

t: 10

8 t tce

)

Renewable

Nuclear

Hydro

NG

Oil

Coal

Primary energy

The Energy Production ScenariosThe Energy Production Scenarios


The per capita energy reserves of China are much lower, The per capita energy reserves of China are much lower, especially for the oil and natural gasespecially for the oil and natural gas

Oil will reach the peak production around 200Mt in 2020, after Oil will reach the peak production around 200Mt in 2020, after then the production will decreasethen the production will decrease

60% oil and natural gas in 2020 will depend on import60% oil and natural gas in 2020 will depend on import

1000Mt coal production new capacity will be set1000Mt coal production new capacity will be set--up before up before 2020, it is a very tough task (reserves, capital investment, 2020, it is a very tough task (reserves, capital investment, ecologyecology……))

0

1

2

3

4

5

6

7

8

2000 2010 2020 2030 2040 2050

100M

t

Demand Domestic production


Increasing Dependence on Oil ImportIncreasing Dependence on Oil Import

Energy efficiencyEnergy efficiency

The energy consumption intensity of GDP of China in 2000 was The energy consumption intensity of GDP of China in 2000 was 0.89kgoe/$US, 3.34 times of world average level and 4.63 times 0.89kgoe/$US, 3.34 times of world average level and 4.63 times of OECD averageof OECD average

4% of world GDP consume 10% of the world electricity4% of world GDP consume 10% of the world electricity

4% of world GDP consume 30% the world iron and steel and 40% 4% of world GDP consume 30% the world iron and steel and 40% of the world cementof the world cement

In developed countries In developed countries –– industry, construction and industry, construction and transportation each consumes roughly 1/3 of the total energy. transportation each consumes roughly 1/3 of the total energy. But in China, industry consumes about 70% (Iron steel, cement, But in China, industry consumes about 70% (Iron steel, cement, aluminum aluminum –– about 60% of the industrial energy use)about 60% of the industrial energy use)

Structure Change needed !


Comprehensive energy efficiency Comprehensive energy efficiency –– 33%, about 10 points 33%, about 10 points percentage lower than OECD countriespercentage lower than OECD countries

Power, Iron and Steel, Nonferrous metals, petroleum chemistry, Power, Iron and Steel, Nonferrous metals, petroleum chemistry, Construction materials, Chemical engineering, Light industry Construction materials, Chemical engineering, Light industry and textile and textile –– 8 industrial sectors, their unit product consumption 8 industrial sectors, their unit product consumption is about 40% higher than OECD countriesis about 40% higher than OECD countries

Iron and Steel, Cement, Paper Iron and Steel, Cement, Paper –– specific energy consumptions specific energy consumptions ––21%, 45% and 120% in comparison with advanced level 21%, 45% and 120% in comparison with advanced level respectively respectively

Efficiency of vehicles Efficiency of vehicles –– 25% lower than in Europe and 20% than 25% lower than in Europe and 20% than in Japanin Japan

Specific energy consumption for building heating is about 2Specific energy consumption for building heating is about 2～～3 3 times higher than the developed countries at the same latitudetimes higher than the developed countries at the same latitude

Enormous potential of energy conservation and Enormous potential of energy conservation and efficiency improvement efficiency improvement


In this concern, not only technology, more important is the In this concern, not only technology, more important is the institutional issues institutional issues –– government policy and regulations, government policy and regulations, taxation, financial incentive of the parties (sectors)taxation, financial incentive of the parties (sectors)

Severe PollutionSevere Pollution

In 2020 the SOIn 2020 the SO22 and NOand NOxx pollutant could be 40Mt and 35Mt pollutant could be 40Mt and 35Mt and exceed 16Mt and 19Mt of the pollutant limits respectively, and exceed 16Mt and 19Mt of the pollutant limits respectively, if no additional control measures will be takenif no additional control measures will be taken

About 40% of the territory of China is suffering acid rainAbout 40% of the territory of China is suffering acid rain

China is the second largest COChina is the second largest CO22 emission country, it will emission country, it will increase in the futureincrease in the future

Forecast of COForecast of CO22 emission from different countriesemission from different countries

Severe PollutionSevere Pollution

•• According to the projection of energy demand and supply, According to the projection of energy demand and supply, coal will still play the dominant role (50%~60% in 2050)coal will still play the dominant role (50%~60% in 2050)

•• Coal utilization will contribute about 70%~75% of COCoal utilization will contribute about 70%~75% of CO22 in in China (at present 76.8%), and SOChina (at present 76.8%), and SO22, NO, NOxx, PM, PM55, Hg as well, Hg as well

•• Coal mainly will be used for power generation in future (up Coal mainly will be used for power generation in future (up to 80%, at present about 45~50%), It means coal fired to 80%, at present about 45~50%), It means coal fired power plants will contribute 60% or more COpower plants will contribute 60% or more CO22 of totalof total

General ConclusionsGeneral Conclusions

•• Large scale mitigation of shortage of liquid fuel could be Large scale mitigation of shortage of liquid fuel could be realized only by coalrealized only by coal--derived alternatives (Fderived alternatives (F--T synthetic fuel, T synthetic fuel, Methanol, DME), Biodiesel and ethanol from corn and Methanol, DME), Biodiesel and ethanol from corn and cellulose could only solve small part of the shortage problemcellulose could only solve small part of the shortage problem

•• Capture COCapture CO22 from flue gas of power plants is investment from flue gas of power plants is investment intensive and with unaffordable large (per unit COintensive and with unaffordable large (per unit CO22) energy ) energy consumptionconsumption

•• ““Hydrogen EconomyHydrogen Economy”” with renewable derived hydrogen is with renewable derived hydrogen is still a long way to go (20~30 years)still a long way to go (20~30 years)

General ConclusionsGeneral Conclusions

What is the way out ?What is the way out ?

•• Sustainable utilization of coal or modernized coal utilization Sustainable utilization of coal or modernized coal utilization beyond direct combustionbeyond direct combustion

•• Coproduction of Power, liquid fuel, chemicals, heat and gas Coproduction of Power, liquid fuel, chemicals, heat and gas via coal (or petrol coke) gasification and oncevia coal (or petrol coke) gasification and once--through through chemical reactors. chemical reactors.

That is:That is: POLYGENERATIONPOLYGENERATION

Except to speed up the development of nuclear and renewable energy

Integrated ResourceIntegrated Resource--EnergyEnergy--Environment SystemEnvironment System

AirSeperation

GasificationHigh Tem.Clean up

Air

Coal

petroleumcoke andresidue

O2

N2,ArNG

Heat/power/coolcogeneration

IGCC or GCC

chemicalproducts

Liquidfuel

others

Syngas

ShiftSteam

Seperation

Heat/power/coalcogeneration

Fuelcell

Large-scalepower

generation

Seque-stration

Dryice

ferti-lizer

algaeplantgrowth

CO2+H2

CO2

H2

Commercialbuilding

residential

enhancementof CBM


Integrated Gasification Combined CycleIntegrated Gasification Combined Cycle


Simplified illustration of PolygenerationSimplified illustration of Polygeneration


•• Polygeneration is the Polygeneration is the sustainablesustainable, , technically consistenttechnically consistent, , technologically realistictechnologically realistic, , economically beneficialeconomically beneficial, and , and ecologically friendlyecologically friendly way for COway for CO22 mitigation, capture, and mitigation, capture, and further sequestration. It is really the most important strategy further sequestration. It is really the most important strategy in China, even in the worldin China, even in the world


•• PolygenerationPolygeneration

–– It doesnIt doesn’’t need specific technology breakthroughs, t need specific technology breakthroughs, consistent to the existing technologiesconsistent to the existing technologies

–– Concentrated COConcentrated CO22 could be easily captured along with could be easily captured along with the natural technological processes, that is, the natural technological processes, that is, polygeneration has the polygeneration has the naturenature easy for COeasy for CO22 capturecapture

–– This is the strategic way for COThis is the strategic way for CO22 mitigation in Chinamitigation in China


With more and more stringent environmental regulation, the advanWith more and more stringent environmental regulation, the advantages of coal tages of coal gasification polygeneration will be more and more economically sgasification polygeneration will be more and more economically significantignificant

SO2+NOX SO2+NOX+Hg+PM2.5

SO2+NOX+Hg+PM2.5+CO2

New coal fired boiler

Gasification


Total Primary Energy Supply

0

20

40

60

80

100

120

140

160

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

BASE CASE Updated model Updated AdvTech with All Caps and Low Nuclear

Exaj

oule

s

EFFICIENCY

RENEWABLES

NUCLEAR

CBM

NGAS

OIL

COALGasification

COALCombustion

Base Technologies Advanced TechnologiesSO 2, 30% O il&G as, 66 G t C Caps

Scenario study (MARKAL model)Scenario study (MARKAL model)

Urgent actions should be taken (1)Urgent actions should be taken (1)

The effect of Advanced Technologies Scenario

•• Provides the same energy services at about the same cost as Provides the same energy services at about the same cost as the Base technologies strategy the Base technologies strategy

•• SOSO22 emissions are reduced from 23.7 Mt in 1995 to 16.2 Mt in emissions are reduced from 23.7 Mt in 1995 to 16.2 Mt in 2020 and 8.8 Mt in 2050 2020 and 8.8 Mt in 2050

•• Imports of oil and natural gas are limited to 30% of consumptionImports of oil and natural gas are limited to 30% of consumptionof oil and gas over the longof oil and gas over the long--term term

•• 66 Gt C caps66 Gt C caps


Projection for Coal Power Plant CapacityProjection for Coal Power Plant Capacity

0

100

200

300

400

500

600

2000 2005 2010 2015 2020

Gig

awat

ts

Post-2000 New Capacity

Pre-2000 Capacity


Delaying the start of the transition to coal gasification based Delaying the start of the transition to coal gasification based polygeneration technology would significantly increase: polygeneration technology would significantly increase:

•• the costs to China of air pollution damagesthe costs to China of air pollution damages

•• the costs of oil importsthe costs of oil imports

•• the costs of reducing GHG emissionsthe costs of reducing GHG emissions


•• China needs a integrated, but divided into long term(20~50 China needs a integrated, but divided into long term(20~50 years), intermediate term (8~15 years) and short term (3~8 years), intermediate term (8~15 years) and short term (3~8 years) energy strategyyears) energy strategy

•• Any significant change in energy system needs long period Any significant change in energy system needs long period (large inertial system with big time constant)(large inertial system with big time constant)

Step on the peel of watermelon (or banana), slipping anywhere Step on the peel of watermelon (or banana), slipping anywhere without definite direction without definite direction

When head aches When head aches –– treat only headache, when leg aches treat only headache, when leg aches ––treat only leg achetreat only leg ache

Are Are notnot the way for Chinathe way for China’’s energys energy

ConclusionsConclusions

Thank You!Thank You!

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0105 Ni Weidou PPT new - Stanford University