‘Key to China’s power future’: cost of solar to match coal power by 2023, scientists say

Solar power, when paired with adequate storage capacity, could meet more than 40 per cent of the country’s electricity demands by 2060, say researchers
Decarbonising the energy system is a priority for China to deal with air pollution at home and global climate change, according to Chinese-US paper

Energy

Holly Chik

Published: 12:00pm, 13 Oct 2021

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The costs of solar and coal power will be comparable across China by 2023 as solar energy conversion becomes more efficient and the cost drops, according to a new study by researchers in China and the United States.

The researchers also found that solar power, when paired with the capacity to store energy for later use, could meet more than 40 per cent of the country’s electricity demands by 2060, at less than 2.5 US cents per kilowatt-hour.

The study suggests “solar plus storage” could be competitive in cost and a grid-compatible source for a carbon neutral power system in China, which is the world’s largest carbon emitter.

China’s ability to decarbonise its energy system “strongly affects” its prospects of limiting global warming to the critical climate threshold of 1.5 degrees Celsius above pre-industrial levels, according to the team.

Solar was expected to be key to a future power system in a country in which coal had been the dominant energy source for more than 40 years, said the team of scientists from Tsinghua University, Nankai University, Renmin University of China and Harvard University in the US.

“The decline in costs for solar power and storage systems offers opportunity for solar-plus-storage systems to serve as a cost-competitive source for the future energy system in China,” the team wrote in an article published in the peer-reviewed journal Proceedings of the National Academy of Sciences of the United States of America on Monday.

“At present, subsidy-free solar power has become cheaper than coal power in most parts of China, and this cost-competitive advantage will soon be further enhanced and extended spatially due to technology advances and cost declines.”

Everything you should know about China’s power crisis

The team projected that solar power in the north, northeast and east China and Tibet grids would achieve full price parity with coal in 2021, when solar power prices would be lower than the local on-grid tariffs for coal power, followed by the central, northwest and south China grids in 2023.

The falling cost of solar power and storage technologies such as lithium-ion batteries – like those used in phones – brought an opportunity to integrate storage systems into solar power stations to better meet demand, they said.

Provinces including Henan, Inner Mongolia, Shandong, Shanxi and Xinjiang require newly-built solar power stations to be paired with storage capacity, according to the paper.

China is in the midst of a critical power crunch, with households and businesses experiencing power shortages from time to time.

The country relies on massive amounts of coal to keep people warm, but some provinces cannot even keep the lights on amid high prices, production cuts and Beijing’s determination to cut emissions.

President Xi Jinping has made bold pledges to hit peak carbon emissions before 2030 and to achieve carbon neutrality before 2060.

On Tuesday, he also revealed that China was building a massive wind and solar power project in the country’s deserts, with an installed capacity of 100GW for phase one construction.

China’s renewable energy capacity poised to outstrip fossil fuel’s

In their joint paper, the authors said decarbonising the energy system was a priority for China to deal with domestic air pollution and global climate change.

“One of the biggest challenges facing China is to deploy low or zero-carbon power generation capacity to meet the increased demand for electricity and to substitute for existing coal-fired capacity in the longer term.

“Among alternative sources, solar photovoltaic power generation is expected to play an important role in this process in China given abundant solar resources and huge PV manufacturing capacity,” they said.

Co-author Chris P. Nielsen, executive director of the Harvard-China Project on Energy, Economy and Environment, said the study showed that the pathway to China’s two carbon goals “might not be as difficult and costly as many have assumed, though it will surely still be a tough road”.

“Demonstrating that expanded solar power can be both grid-compatible and cost-competitive is a hugely positive finding, perhaps allowing more attention to be directed to resolving the challenges of real-world implementation to deliver on this opportunity,” he said.

He said the country would still need to overcome institutional, political and policy impediments, and more innovations and breakthroughs to deliver solar power at scale with a competitive price and grid compatibility.

The country should continue to develop other clean energy sources such as wind, hydro, nuclear and biomass, negative-carbon strategies and those to control non-carbon dioxide greenhouse gases towards carbon neutrality, according to Nielsen.

China is the world’s biggest producer of solar power. It had 170 gigawatts of installed solar power capacity by the end of 2018, up from 77GW in 2016.

The country is also the world’s largest solar cell manufacturer, producing 110GW of the 144GW of solar cells made globally in 2019, according to the International Energy Agency.