The “21st Century Power Partnership (21CPP)” and “Multilateral Solar and Wind Working Group (MSWWG)”, the two most important initiatives (long-term working group) under the CEM framework, organized two side events on June 6 2017 in China National Convention Center, Beijing in the margins of the 8th Clean Energy Ministerial (CEM8). Topics discussed during these events included direction of the 21st century power system reform, future competitiveness of solar and wind energy and the leading roles the two play in system transformation. This also marked the first CEM side event after National Energy Administration’s formal entry into the two initiatives. China National Renewable Energy Centre (CNREC) was commissioned by National Energy Administration (NEA) to co-organize and address the 21CPP and MSWWG side events.
The 21CPP Side Event
The theme of the 21CPP was “power system transformation: renewable energy integration, market design and power system planning”. An Fengquan, Deputy Director General of International Cooperation Department of the NEA, Christian Zinglersen, Head of Secretariat for the Clean Energy Ministerial Secretariat, Griff Thompson, Deputy Assistant Secretary for Energy Transformation at the US Department of State, Kate Hampton, CEO at the UK’s Children’s Investment Fund Foundation (CIFF), and Zhao Yongqiang, Deputy Director of CNREC, together with a few other distinguished guests, addressed the event and participated in discussions.
In his speech, An Fengquan, Deputy Director General of the NEA‘s International Cooperation Department, stressed that the Chinese government attaches great importance to energy transformation, and views the building of a green, low-carbon, safe and efficient modern energy system as a key energy transformation target for the time being. Transforming the power system is a core and priority task for China’s energy transformation. Over the past decade or so, China has made consistent efforts to put in place, and improve, the green, low-carbon power system, while at the same time paying high attention to improving the efficiency and flexibility of thermal power units. The 21st century power system and market must be adapted to large-scale, fluctuating renewable energy sources. With international cooperation mechanisms like the 21CPP, China hopes to draw on more advanced global experience in a bid to fully utilize the positive functions of multiple approaches, such as smart grid, energy storage and electric vehicle, find better solutions to difficult problems in renewable energy integration, give play to the crucial role of market in resource allocation, and eventually form a fully-fledged power market mechanism.
In discussing “challenges the power system reform is currently facing”, guest speakers expressed that under the current circumstances, the advancement of energy transformation, deeming a high proportion of renewable energy as its primary target, would be difficult without the combined action of policy and market, a viable way to achieve “resource sustainability, environmental friendliness, safe and reliable supply, and economic affordability” and multi-dimensional transformation resulting from joint effects of technology, policy, market and management modes. In addition, we must also give full play to the role of the global energy governance system to ensure energy security following large-scale renewable energy connection to cross-border energy infrastructure and interconnection facilities.
Regarding “market design for the power system transformation”, Zhao Yongqiang, Deputy Director of CNREC, pointed out that as future power system is mainly characterized by variable power production, distributed power demand response and cross-sector integration, a fully-fledged power market must be free from monopoly, competition oriented and capable of enhancing system flexibility. Alain Steven, President of GO15, emphasized the important role government plays in power system transformation, noting that the power reform is implemented in a top-down manner, which helps intensify connections among different regions, improve the grid’s reliability and overcome grid inertia.
Griff Thompson, Deputy Assistant Secretary for Energy Transformation at the US Department of State, said in his speech that the US authorities governing technology, foreign affairs and energy pay high attention to energy and power system transformation, which may concern a country’s economic, political and social systems. This Administration, like its predecessors, will work together with members of the 21CPP and continue to dedicate itself to establishing a low-carbon, green and efficient power system and energy service network.
The MSWWG Side Event
The theme of this MSWWG Side Event is “energy scenarios in accelerating the clean energy transition: focus on wind and solar”. Lars Christian Lildeholt, Danish Minister for Energy, Utilities and Climate, Liang Zhipeng, Deputy Director General of the Department of Renewable and New Energy of NEA, Thorsten Herdan, Director General of the Energy Policy Department at Germany’s Federal Ministry for Economic Affairs and Energy (BMWi), Paolo Frankl, Head of the Renewable Energy Division at the International Energy Agency (IEA), Dolf Gelen, Director of the IRENA Innovation and Technology Centre, and Tao Ye, Deputy Director of CNREC, attended and addressed the event.
Liang Zhipeng, Deputy Director General of the Department of Renewable and New Energy of NEA, said that wind and solar energy demonstrate good development momentum and have a vast potential for the future. In the face of the big trend for energy transformation, China has been keen to develop clean energy, including wind and solar, to further low the costs of wind and solar PV power generation by way of technological advancement and policy, and to enhance the economic benefits and competitiveness of renewable energies; we will develop distributed solar PV plants, dispersed wind farms and offshore wind projects in the east, while constructing large-scale wind and solar PV power generation bases in the north where wind and solar energy resources are abundant; we will utilize hydro and photo-thermal technologies to achieve peak load regulation, and use ultra-high voltage grid (UHV grid) to improve power consumption capacity across different provinces and regions. In addition, China also attaches great importance to using wind energy to produce hydrogen and supply heat, and to improving the power consumption capacity of localities. Through such mechanisms as the MSWWG and cooperative research in specialized fields, China hopes to continuously share experiences and deepen exchanges with other countries, including Germany and Denmark, in technological aspects and the power market, and strive to consume and utilize wind and solar energy within a broader range of areas.
Tao Ye, Deputy Director of CNREC, briefly introduced the latest progress in “China Renewable Energy Outlook (2017)”, a research effort jointly conducted by CNREC, the US National Renewable Energy Laboratory (NREL), Danish Energy Agency, Germany’s Agora and DENA. As wind and solar PV transform themselves from supplementary to backbone energy sources in the coming several decades or so, he pointed out that it is imperative that we re-examine our development thinking about renewable energy and the power system, evaluate the contribution of wind and solar PV to the entire power system, and deem pursuit of high-capacity and high-contribution value as important requirements, as high system value warrants higher transaction prices for wind and solar power in the electricity market.
It is a shared belief among meeting attendees, either in their speeches or discussions, that as wind and solar energy evolve and the cost per kilowatt hour of electricity continues to decline, grid parity has now basically become a reality. Compared to traditional fossil-based fuels, they display superb economic and environmental advantages. We are now in a stage when they are gradually shifting from supplementary to backbone energy sources. From a market perspective, we must re-examine the present energy system layout, and strive to create a power market mechanism adaptable to large-scale grid connection of renewable energy. We must also guide market expectation and promote power “transmission, generation and distribution” upgrading, enhance demand response and improve system flexibility.
From the perspective of grid connection, we must strive to improve power system flexibility based on the power market transaction mechanism, integrate large-scale cross-regional power grids with microgrids and distribution power generation, give play to their supplementing and supporting roles in achieving resource sharing and reduce the fluctuations of new energy at their very roots. We must pay close attention to the role of power grids in peak regulation and frequency regulation, lower the wind and solar curtailment ratios and therefore increase the utilization efficiency and overall energy efficiency of renewable energies. Moreover, whilst making overall plans for transformation in the fields of power, transportation, heat and cold supply, and building, we must make full use of emerging digital information technologies such as big data, Energy Internet, and Internet of Things (IoT), and step up efforts to transform our current energy system into a cleaner one.
Contributors: Hang Yu, Zhao Yongqiang