Summary of Key Points
The National Development and Reform Commission (NDRC) and the National Energy Administration have released the "15th Five-Year Plan" for the construction of a new energy system, outlining the key objectives for the energy sector by 2030: the installed capacity of wind and solar power generation should exceed 50%, and the share of non-fossil fuel power generation should reach 50%. This indicates that new energy sources, primarily wind and solar, will transition from being supplementary to becoming the core power sources, taking over the role previously held by coal-fired power. To address the issue of instability in power supply caused by the reliance on weather conditions for these renewable energy sources, the plan proposes increased investment in the power grid (over 5 trillion yuan during the "15th Five-Year Plan" period), the construction of energy storage facilities, and the improvement of electricity market mechanisms to ensure the safe and stable operation of the new energy system.
Objective 2030: Wind and Solar to Become the Main Power Sources
The 2030 goals include two targets of 50% each:
1. The installed capacity of wind and solar power generation should exceed 50% (it is currently close to 47.9%, nearly meeting this target).
2. The share of non-fossil fuel power generation should reach 50% (it is currently at 40.5%, still about 10 percentage points short).
Why is the share of power generation more challenging to achieve?
Because installed capacity refers to the number of devices, while power generation actually refers to the amount of electricity produced. Wind and solar power are dependent on weather; without wind or sunlight, they cannot generate electricity. Therefore, even if a large number of devices are installed, the actual amount of electricity available for use may not be sufficient. For example, if you install 10 solar panels on your roof, they might only produce 2 kilowatt-hours of electricity on cloudy days, highlighting the difference between installed capacity and actual power generation. The plan requires that by 2030, new energy sources (mainly wind and solar) generate 30% of the total power, and together with hydropower and nuclear power, non-fossil fuels should account for 50%.
New Energy Must Become Self-Sufficient: Moving from Policy Support to a Critical Role
In the past, the development of wind and solar energy relied on subsidies. The new plan calls for transitioning away from these policy incentives and assuming the responsibility previously held by coal-fired power.
Coal-fired power has always served as a stabilizer, capable of generating electricity immediately when demand increases. For wind and solar to replace it, they must fill this gap. For instance, during peak summer electricity usage, other sources (such as energy storage) must be available to compensate if wind and solar do not produce enough power. This means that new energy sources must not only be widely deployed but also reliable and capable of supporting economic demand without relying on government subsidies.
How to Overcome the Challenge of Inconsistent Power Output?
To ensure that wind and solar power can be generated, stored, and used effectively, the plan includes several specific measures:
1. Energy Storage as a Backup: By 2030, 160 million kilowatts of pumped storage capacity (similar to reservoirs for storing electricity) and 300 million kilowatts of new types of energy storage (such as batteries) will be built, creating a large network of backup systems.
2. Upgrading the Power Grid: The plan aims to enhance the ability to transport electricity from western regions (rich in wind and solar resources) to eastern regions with high demand, and improve distribution networks to accommodate 900 million kilowatts of distributed new energy sources (such as rooftop solar panels).
3. User Participation in Regulation: For example, electric vehicles can be used to temporarily store or even discharge electricity during peak usage times. Virtual power plants, which aggregate the regulation capabilities of many small users, can provide up to 50 million kilowatts of additional capacity.
Significant Investment in the Power Grid
The "15th Five-Year Plan" forecasts investment in the power grid to exceed 5 trillion yuan, nearly doubling the 2.8 trillion yuan allocated during the "14th Five-Year Plan". The funds will be used for:
- Building more channels to transport clean energy from western regions to eastern regions (e.g., wind power from Xinjiang and hydropower from Sichuan to Shanghai and Guangdong).
- Improving distribution networks in cities, counties, and rural areas to facilitate the integration of distributed new energy sources and reduce outages.
Market Mechanisms to Ensure Profitability
Having the necessary infrastructure is not enough; new energy sources must also be economically viable for companies to invest. The plan emphasizes the establishment of a national unified electricity market:
- New energy sources will be fully integrated into transactions, allowing them to sell their power to eastern regions based on supply and demand, with green energy commanding higher prices due to its environmental benefits.
- Cross-provincial and cross-regional trading will enable excess wind and solar power to be sold in other areas, preventing waste.
Zhang Wenfeng, General Manager of the State Grid, stated that by 2025, new energy sources should be fully integrated into the market. This will not only help solve the issue of power consumption but also motivate companies to continue developing these renewable technologies.
Safety as a Priority
A high proportion of new energy sources can lead to grid instability (as seen in some countries with high reliance on wind and solar). Therefore, all measures outlined in the plan (energy storage, power grid improvements, and market mechanisms) are designed to ensure the safety of the electricity system while promoting the development of new energy.
In summary, the goal for 2030 is to make new energy sources the primary power source. Achieving this will require a combination of technological advancements (energy storage, power grids), financial investment, and effective market mechanisms to ensure that the transition to renewable energy is both environmentally friendly and stable.