Beyond Economics

By Siwen Chen

Introduction

Winds is free and clean energy. Once a wind turbine is built, the large amount of energy it produces does not cause any pollution. Nowadays, wind power is already a crucial part of China’s energy mix and is China’s second largest source of renewable energy. Most cities have set up the wind turbines in several provinces such Xinjiang, Zhejiang, Guangdong, Shandong, Jiangsu, Hubei and so on. Chinese government has identified wind power as a key growth component of the country’s economy. Never before has a country attempted to stimulate its domestic wind market on such a scale or speed. In just a few years, “China has become the world’s fourth largest producer of wind energy and its domestic turbines have already reached a reasonable level of quality” (Edmondson, 2009). In addition, wind energy can provide new sources of income in rural areas in China, as well as jobs for people who set up and maintain wind turbines or manage wind farms. Domestic manufacturers produce turbines at much lower costs, grabbing business away from foreign competitors, which has increased China’s GDP. To sum up, the wind turbine as a green trend is very important because it not only improves China’s environment but also benefits China’s economy.

In the report, I will cover some background of the wind turbines in China, and analyze its benefits and importance as well as provide some arguments towards the fast growing quantity of wind turbines. Since mainland China has gained a large coverage of wind turbines, the importance of the wind power has been revealed. More and more industries and families depend on the wind turbine to support their daily electricity use. However, China is facing some serious challenges in meeting its wind power goals. Wind turbines are expensive to build in a suitable geographical position such as the wind strength and direction. At the end, I will point out my concern and opinion of the wind turbines.

Background

Wind power is an alternative energy resource of virtually unlimited potential. The wind turbines generate electrical power by tapping and processing wind energy. A wind turbine usually needs wind speeds of around 10 miles an hour (16kmh) to start generating electricity, and optimum wind speed for large turbines is approximately 30 miles per hour. Wind speed usually increases with height and where there are no natural or man-made obstructions. A wind turbine works when the blades of it rotate, usually at a rate of from 10 to 50 revolutions per minute, which spins a low speed shaft with a gear at the end. It is connected to another smaller gear on a high speed shaft that runs through the generator (“How wind turbines work”, 2008).

From a historical record: “In 1986, China built its first wind farm in Rongcheng, Shandong Province. From 1996 to 1999, wind power developed very quickly, entering a localization stage. By the end of 2004, there were 43 wind farms with 1291 wind turbines in China, with 764 megawatts of installed capacity” (“Wind Power in China,” 2006). Within an extremely short period of time, the capacity of wind turbines in China has reached a very high level, estimated “from 20kW to 30 kW for every turbine” (Martin, 2010). According to the China Academy of Meteorological Sciences, the country possesses “a total 235 gigawatts of practical onshore wind power potential that can be utilized at 10 meters above the ground. Annual potential production from wind power could reach 632.5 gigawatts if the annual, full-load operation reaches 2,000-2,500 hours” (“Wind Power in China”, 2006). Such a high figure of wind power has been obtainable in China. Many other countries have started in their efforts to harness wind energy. “China, Germany, India and the United States of America – all had high levels of installed capacity, by the end of the year 2007” (Martin, 2010).

Moreover, besides the onshore wind power that has been obtained, the potential for offshore wind power is even greater, estimated at 750 gigawatts. Offshore wind speed is also more stable than onshore wind, and its farm sites are closer to the major electricity load centers in eastern China. “Areas rich in wind power resources are mainly concentrated in two areas: northern China’s grasslands and Gobi desert, stretching from Inner Mongolia, Gansu, and Xinjiang provinces; and in the east coast from Shangdong and Liaoning and the Southeast Coast in Fujian and Guangdong provinces” (“Wind Power in China”, 2006). For example, the first offshore wind farm in Shanghai Dongdaqiao provided all the electricity to the 2010 Shanghai Expo.

The wind turbine has become an important source of electricity in China and continues to give a big impact on Chinese economy and employment. “At the end of 2009, wind power in China accounted for 25.1 gigawatts (GW) of electricity generating capacity” (Pruitt, 2010). And one gigawatt of electricity can support around 300 thousand families for one year. In the estimation, “By 2020, 17% of the nation’s electricity generators are expected to be powered by clean energy totaling 290 million kW.” (“Blown away by a Beijing wind farm”, 2010) Wind turbines lead China to an energy-efficient and environmental prospective.

Analysis

China launched several incentive programs to support domestic wind turbines in 2001, including a “National Deb Wind Program” designed to compensate wind farm owners for use of domestically produced turbines, and a value-added tax reduction for turbines with locally produced parts. Many local governments fund the creation of turbine manufacturing to break into the market. “Today there is over 100 turbine manufacturers in China with the top 13 holding 98% of market supply”(Rutkowski, 2010).

All this policy helped China’s wind power industry to boom, and many corporations in the wind industry have expanded their business operations fast and become the larger job providers in the society. At the same time, these companies also gain profits by providing more and more electricity for the whole country from those wind turbines. “China’s wind power sector is the fastest growing in the world, driven by a growing demand for energy resources and strong central support for development” (“Wind… ambitions”, 2010). For example, since early 2007, Wu Jianhua, the founder of CWS—China Wind Systems, Inc. and his management team realized the huge business potential of China’s wind power industry. Mr. Hua said: “The wind turbine and turbine components industry in China has much room for rapid expansion over the next decade. CWS is certainly benefiting from China’s wind power industry boom” (“Wind… ambitions”, 2010). But most corporations have to consider the large cost of the wind turbine. “When CWS entered the wind power industry, we had originally planned to manufacture wind turbines, but later found out how costly it was.” Mr. Hua said (“Wind… ambitions”, 2010).

Instead of the coal which is harmful to the environment, wind power is widely used in high energy-required industries as well as most families in China. On the other hand, China structured large-scale wind turbines in many cities which can provide a huge amount clean green energy for most electricity use. This helps the bad situation of energy shortage in China due to the large population. There are some ways to improve the wind turbines. The larger size of the wind turbine is more competitive and supportive: “Wind turbines with more than 3 Megawatts of installed capacity generate power more efficiently than smaller turbines”, wind power industry expert Miao Hailong said (“Wind… ambitions”, 2010). China also has many good locations for setting up wind turbines with high wind speeds such as eastern China’s coastal regions.

Arguments Against

First, building a wind turbine is expensive, so the Chinese government gave tax benefits and impressive profits.  From the estimation of spending on a wind turbine, “wind turbines of 2 MW in size cost roughly $2.8 million installed capacity” (Peterson, 2008). Smaller farm or residential scale turbines cost less but they are more expensive when per kilowatt of energy producing capacity is applied on the rates. This would indicate that “a 10 kilowatt machine might cost roughly around $48,000. In this manner 100 kilowatts wind turbines would cost roughly $2,800 to $4,800 per kilowatt of capacity” (Peterson, 2008).

However, there is not only the large cost of manufacturing wind turbines, but also they require a rural area and suitable geography. China hopes to overcome its long-term energy challenge with investment in wind power. To assemble a wind turbine, builders should choose a rural area with a relatively convenient transportation system in order to ship or haul the wind turbine components.

Thirdly, with the further large-scale expansion in electric power generation in China, the government’s policies designed to support domestic wind turbines may have led to overinvestment and overcapacity. Unfortunately, the wind turbine industry takes advantage of the policies, such as the tax breaks. Many internal experts have pointed to potential waste in China’s large-scale wind power development.

Moreover, wind farms make a lot of noise. It will impact people who live close to wind farms. “The sound of the turbines cutting the air falls in the 500 to 1,000 Hz, which qualifies as neither infrasound nor low-frequency sound,” Dr. McCunney said (Bailey, 2010). However, the wind turbines do not affect human’s health. “There’s no reliable evidence that infrasound below the hearing threshold produce physiological or psychological effects,” he said, referring to the WHO report (Bailey, 2010). But a large wind turbine isn’t very loud from an objective standpoint. Actually, people like the wind turbines, even the people who live beside the wind farm, because, they claimed that they obtained jobs and money from building and maintaining the wind turbines.

Conclusion

Nowadays, China continues to put more investment in the wind turbines. According to the China Wind Energy Association, “In 2009, China overtook Germany to become the country with the second-largest installed wind power capacity after the United States” (“Wind … NYSE”, 2010). In my opinion, I will support building the wind turbine because it really helps the shortage of electricity use in China due to the large populations and companies that need a large amount of energy.

Looking forward to the future of wind turbines, “Chinese government has promised an investment of $265 billion to achieve a renewable energy target of 15% by 2020, excluding hydro power” (Edmondson, 2009). Hebei province in China will be installing a 1000 MW wind turbine power plant. It is expected to be completed by the year 2020. The wind power available locally would help this plant generate wind electric power up to a maximum amount of 253,000 MW. In the future, China also should consider improving the quality of the wind turbine such as increasing the size of the wind turbine. The bigger the size of the turbine, the better function it has. Furthermore, China will increase the number of wind turbines in several cities.  In four to five years, the base will have an annual capacity of 800 to 1,000 sets of turbines. But China should take the location of the wind turbine into account so that building the wind turbine will not affect animals like birds. With the country’s large land mass and long coastline, China is expected to use these wind resources, which implies huge potential for wind turbine makers to expend more area.  Added up governments’ supports, I agree that the wind power energy will have a brighter future in China.

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