Cleantech Investing

China is on track to meet its 2030 emissions goal under the Paris Agreement, but not all countries can say the same.

While powerhouse China is on track to meet its 2030 emissions goal under the Paris Agreement, experts continue to emphasize that fighting climate change is a global pursuit requiring work from nations across the globe.

The Asian country has made notable strides in solar power, and is currently set to lead the global concentrated solar power (CSP) race, Pavan Kumar Vyakaranam, power analyst at GlobalData, told the Investing News Network (INN).

GlobalData recently released a report highlighting China’s dominance in CSP, which uses mirrors to generate solar power. The country sees it as a reliable and stable source of power.

In the report, GlobalData says worldwide CSP capacity is set to reach 22.4 gigawatts (GW) in 2030, up from 5.6 GW in 2018. The majority of the additions in the space will happen in countries like China and Chile as well as parts of the Middle East North Africa region.

The Chinese market in particular has been riding on the announcement of 20 CSP projects that are part of the country’s feed in tariff (FIT) scheme. These projects will get a FIT of RMB 1.15 per kilowatt hour (kWh), translating to US$0.17 per kWh.

“China added around 200 MW of CSP capacity in 2018, which is almost seven times its cumulative installed capacity at the end of 2017,” Vyakaranam says in the report.

China’s National Development and Reform Commission introduced the FIT mechanism in 2016 to support the CSP industry and its development. The FIT scheme provides energy operators with long-term contracts at a certain rate, and is designed to promote investment in renewable energy.

The tariffs provided to operators vary according to the type of renewable energy. The grid operators that bear these costs are given financial aid through a renewable energy premium.

China’s renewable energy focus

China has been aggressive on its renewable energy program. Under its 13th Five Year Plan for Renewable Energy Development, it hopes to increase its renewable energy capacity to 680 GW by 2020.

The country has made drastic moves to cut down on greenhouse gas emissions, and noted in 2017 that it had cut carbon intensity 6.6 percent from 2015 levels. Further, the country’s non-fuel energy sources increased to 13.3 percent in the same period.

Specifically, the country has set the solar industry a target of 110 GW for 2020, with the photovoltaic (PV) market accounting for 105 GW and the CSP market required to chip in 5 GW. While CSP involves mirror technology that uses a focal point to generate electricity, PV uses panels to generate power.

Despite China’s advanced efforts, Vyakaranam told INN that he expects the country’s total CSP capacity to hit 5.2 GW by 2030, far after its 2020 target. He said that GlobalData’s predictions for the Chinese market as well as for global data are based on this market scenario.

China has also been promoting investments in the PV market through the FIT scheme. In 2013, the country issued its initial development policy for the industry and has since revised its prices.

In 2017, China set a tariff in the range of RMB 0.8 kWh (US$0.12) to RMB 0.98 kWh (US$0.15) per hour, depending on the region.

CSP a reliable renewable energy source

Despite the number of renewable energy sources available to China and other countries, Vyakaranam sees CSP as a more dependable provider over other renewable sources.

“There’s an influx of renewables in different countries because of whatever [climate change] targets they opted, whatever incentives they are providing to different technologies like solar PVs,” he told INN. “So, there’s a lot of installations, but these sources are intermittent.”

With lots of countries looking at climate change and ways to reduce carbon emissions, Vyakaranam said that these nations need reliable power supply that is renewable.

“If you add thermal storage to [CSP], that provides 24/7 reliable and stable power,” he said. “Countries that are looking at energy storage and serious means of reliable and stable power as well as developing renewables are all going to do good.”

With China providing FIT to the market and tasting success with the first round of CSP projects, Vyakaranam said that the country is planning for a second round of demonstrations with CSP. The additional round is expected to contribute another 3 to 4 GW to the country’s tally.

Vyakaranam said that no other country is expected to post such a level of growth as China in the forecast period, and compared China’s CSP growth to its previous moves in the PV space.

“We have seen China taking up PV as a challenge. When they first entered the market, they started installing gigawatt-scale projects over the years,” he said. “They took it to another level, which probably no other country has done so far.”

Vyakaranam said that China has a 30 to 40 percent market share in the global PV market. In 2018, the country had a capacity of 175 GW in the PV solar market, with the ability to reach 506 GW in 2030.

Across the world, the current capacity of the PV market was at 492 GW as of 2018, and is expected to rise to 1,544 GW in 2030.

China’s climate change efforts not enough

China is pushing its boundaries and adding more renewable energy than other countries, and researchers feel that the country is likely to meet its emissions goal well before its Paris Agreement target of 2030.

However, a journal article published in Nature Communications states that China’s 20 percent non-fossil fuel target for its energy needs will be “difficult or impossible” to hit.

The research, published in March 2019 by a team led by Kelly Sims Gallagher, director of The Fletcher School’s Climate Policy Lab at Tufts University, notes that China needs to address policy gaps to meet its climate change targets.

China’s national emission trading system, FIT and power sector were picked by experts as the three areas that are in need of reform.

Speaking to AFP, Gallagher said that the primary task for China is the reforms on its power sector. “There is political resistance from owners of existing coal plants, and from the provinces with major coal production and coal use,” Gallagher said.

Crucially, Gallagher said that one country alone cannot stop climate change and that every country across the globe will have to make some contributions.

“All of the major industrialized countries will need to reduce their emissions, and rapidly developing countries will need to implement alternative growth strategies with the help of wealthier countries.”

Canada and other nations must step up

Many Paris Agreement signatories have faced criticism for the steps they have taken to meet their 2030 targets. Even China, which is on track to meet its pledge, has not been exempt.

One of the nations that is set to miss the mark is Canada. A report from the country’s federal government states that Canada’s climate is warming at twice the rate of the global average, but as noted in INN’s 2019 first quarter cleantech report, the country’s political parties have polarized views on how to address clean technology.

Canada only has a marginal presence in the solar space. In 2018, Canada had a capacity of 3.2 GW of PV capacity; GlobalData expects 600 to 700 MW to be added annually, which will mean 11.3 GW by 2030.

While the federal government’s latest budget does focus on cleantech, including incentives to buy electric or hydrogen vehicles and to build wind energy projects, Ontario’s conservative government has brought Canada’s federal carbon tax to the courts.

For its part, the New Democratic Party (NDP) has been vocal on the topic of Canada failing to meet its 2030 targets, stating that the federal government’s plan is “failing miserably.”

“If the current trend continues, Canada will meet its weak Paris Agreement reduction targets in 2230,” NDP Deputy Leader Alexandre Boulerice, said in a statement. “That’s 200 years later than promised.”

Robert Hornung, president of the Canadian Wind Energy Association, said that there is no political consensus on how Canada should navigate a shift to a cleaner economy.

“As it stands, Canada is not on track to meet its climate change commitments, and that weighs heavily in political narratives about how Canada should produce and use energy,” he said.

As 2030 draws closer, it will be important to watch whether China’s efforts stay on track and whether countries like Canada can step up to meet their targets. As Gallagher emphasized, a global push will be required to control emissions.

Don’t forget to follow us @INN_Technology for real-time news updates!

Securities Disclosure: I, Bala Yogesh, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in contributed article. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.


S&P 5004145.19-6.75


Heating Oil3.20-0.13
Natural Gas8.01-0.12