The World Bank today approved an US$86.33 million loan to scale
up China's use of renewable energy as the country's demand for
power increases.
The World Bank's Board of Executive Directors approved the
follow up project to the 2005 China Renewable Energy Scale-Up
Program Phase 1 which would develop a large wind farm in the Inner
Mongolia Autonomous Region and rehabilitate and develop selected
small hydropower projects in Zhejiang Province.
The overall renewable energy scale-up program aims to develop
the Chinese commercial market for energy suppliers to provide
renewable energy to the electricity grid on a large scale in an
efficient and cost-effective way. Renewable energy sources like
wind power, solar power, and biomass have up to now been produced
only in small-scale, pilot programs, outside the main electricity
supply.
"China's energy demands and its need to decrease air pollution
make large-scale renewable energy development an important goal,"
said Noureddine Berrah, lead energy specialist for China. "The idea
behind the program is to increase the commercial, large-scale use
of renewable energy sources like wind, small hydropower, and solar
energy so that they contribute to meeting the fast-growing
electricity demand from homes, farms, and businesses."
As China's gross domestic product quadrupled from 1980 to 2000,
its energy consumption more than doubled to about 1300 million tons
of coal equivalent (Mtce). Projections for energy consumption
indicate that fuel consumption could double or almost triple by
2020 (between 2,500 to 3,300 Mtce), even if energy efficiency
efforts were increased.? The follow-up project to the China
Renewable Energy Scale-Up Project (Phase I) provides investment
funds to help demonstrate success in large-scale renewable energy
development by local renewable energy developers as other local
investment funds take time to materialize.
A total of US$67 million of the Bank's investment would go to
the development of the 100 MW Huitengxile Wind Farm in the Inner
Mongolia Autonomous Region, which is currently home to
approximately 70 MW of wind generation capacity. An additional
US$19.33 million would finance the rehabilitation and development
of selected small hydropower projects (not exceeding 10 MW) in
Zhejiang Province.
The US$86.33 million International Bank for Reconstruction and
Development (IBRD) loan is a variable spread loan which matures in
20 years with a 5-year grace period. The project, which is set to
start in April 2006 is expected to be completed in March 2010.
(China.org.cn February 8, 2006)