China’s 5 Year Plan – The Overall Impact on Clean Technology

China’s 5 year plan has once again stated a focus on Green sustainable energy technologies. The government already recognises that future economic growth cannot be sustained at the current pace with similar levels of high pollution and over consumption of natural resources. The energy development strategy included in this, the 12th5 Five Year Plan (covering 2011 through to 2015) focuses on structural adjustments in energy resources.

Domestic energy providers are going to be encouraged to acquire key technologies in emerging renewable energy industries in China and overseas. This is seen as essential for the development of clean tech/”new energy” overall.

The plan also includes a sensible layout for the development of new energy sectors in the country. With focus on wind, solar, biomass energy generation, coal gas, nuclear and smart grids.

Senior government officials have confirmed that China intends non-fossil fuel based energy sources to amount to 11.4% of primary consumption in the country by the end of the plan.

Solar Photovoltaic

The PV industry will be expected to mature into an advanced manufacturing base and deliver high value to the new energy sector across the course of the plan.

Smart Grid

Smart grid technology will be expected to be incorporated in all new transmission capability where possible. Ultra high voltage lines covering 40,000 km will received an investment of 500 billion Yuan, to improve transmission of energy from the resource rich (but low population) Western and Interior regions to the East coast major population centres.

Nuclear Power

China has reiterated that following the Japanese quake their own nuclear strategy will remain unchanged, though there will be a temporary halt to new construction until lessons can be learned from that disaster to improve the safety of their own plants. With long-term plans for 138 new nuclear power plants the country has a serious commitment to this clean energy source. It is understood that Chinese consumption of Uranium will overtake US consumption by the year 2020.

Increased Oversight

The Chinese government is to increase levels of oversight on high pollution industries. This is almost certain to include a market cap on the volumes of coal consumption in current manufacturing hotspots, such as the Pearl River Delta, Tianjin, and Yangtze River Basin areas. There will also be a widely anticipated review of emission restrictions on coal based power plants expected to make Chinese standards the strictest in the world today.

For Investors

The ministry of commerce and the NRDC are expected to revise guidelines controlling foreign investment in green industries to encourage further rapid growth in clean energy technology. China’s Central and Western regions will be offering unusual levels of support for investors looking to produce successful local partnerships in this field. Also supporting a key element of the 5 year plan to improve the capabilities of indigenous innovation structures and furthering the transformation of those industries by leveraging new technologies.