China Moves Towards Energy, Not Oil
When China unveiled its’ ambitious renewable energy law in 2005, pledging that by 2020 15 percent of the country’s power would be drawn from renewable sources, it attracted more than a few raised eyebrows. Chinese leaders are fond of long-term plans and big targets. But how, exactly, did they plan to hit this target in the face of China’s fast-growing economy and energy consumption?
Two years later, this is now becoming clear.
In September, top energy planner Chen Deming said that the government would institute subsidies and tax breaks to encourage investment in renewables. The total price tag for the 15 percent target, he added, would be two trillion yuan — about $265 billion, or one-tenth of China’s 2006 GDP.
Sure enough, last week China National Offshore Oil Corporation (CNOOC), China’s third largest petroleum company (best-known in the U.S. for its botched 2005 bid to buy American oil giant Unocal) announced plans to establish a 1,500 KW off-shore wind farm in Bohai Bay. With Beijing pushing renewables, CNOOC now aims to be “an energy company rather than just an oil company.” As company chairman Fu Chengyu told Xinhua, “[T]he national development mode decides the development of our company.” Strong government backing has Chinese companies convinced they can profit from renewable energy.
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