China Launches $4 Billion Power Transmission and Storage Project

China has started the construction of a $3.9-billion electricity transmission and storage project aimed at enhancing the resilience of its grid, which has come to rely heavily on wind and solar generation capacity.

According to a Bloomberg report, the project involves building a transmission line of over 1,000 km, or 664 miles, across three provinces and its connection to a pumped hydro storage site. The transmission line will carry electricity produced from wind and solar installations backed up by coal.

China installed a record-high solar power capacity last year, with additions in 2023 alone topping the current capacity of the entire U.S. solar fleet.

China added as much as 216.9 gigawatts of solar power capacity in 2023 – a record high, obliterating its previous record of 87.4 GW of solar power additions in 2022, according to data from the National Energy Administration.

Last year, China also added 75.9 GW of wind—another record high and much higher than the 37.6 GW added in 2022, according to the Chinese data. Wind and solar generation capacity in the country surpassed 50% of the total—a milestone that China expected to achieve by 2025.

Despite having the largest wind and solar capacity in the world, China is still heavily reliant on coal-generated electricity, so this would likely increase if the stimulus measures work as planned. And coal generation output might just break last year’s record of 5,760 TWh. With it, emissions will rise, even as wind and solar installations continue to grow and fast.

This growth has exposed the same grid constraints that have become apparent in other countries determined to replace their hydrocarbon generation capacity with wind and solar. The problem generally boils down to the fact that most of the time, the places with the greatest wind or solar potential are not near the places that consume the most electricity.

This necessitates grid upgrades that are both costly and take quite a lot of time to implement, preventing wind and solar from realizing their full potential.

By Charles Kennedy for Oilprice.com

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