stations serving 2 million fuel cell vehicles,
supported by 3,000 km of high-pressure hydrogen pipelines. In addition, China will develop a
technical standards system for hydrogen energy
infrastructure to match those in developed
economies. And it will innovate hydrogen and
fuel cell technologies and services to support the
continued development of the hydrogen energy
industry.
In the next 3–5 years, the hydrogen energy
industry will see massive growth thanks to
extensive production, safe and large-scale storage, continuous supply, long-distance transmission and fast replenishment. Hydrogen fuel cells
and lithium-ion batteries are the two pillars of the
new energy vehicle industry. Fuel cells are being
vigorously promoted across China. For instance,
Shanghai released a development plan for fuel
cell vehicles in September 2017, which forecast
that the city will have more than 100 fuel cell
vehicle related companies by 2020 and build 50
hydrogen refuelling stations by 2025. Fuel cell
vehicle technology and manufacturing will match
international levels by 2030, and the annual output value of Shanghai’s fuel cell vehicle industry
will exceed RMB 300 billion ($43.5 billion).
(2) Coal-to-hydrogen and carbon capture and
storage will become mainstream
China has abundant and relatively inexpensive
coal resources, so coal-to-hydrogen will probably
become the main method for large-scale hydrogen production. However, the coal-to-hydrogen
process emits large amounts of CO 2 , so the use
of carbon capture and storage (CCS) technology
is necessary to reduce emissions. Currently, CCS
technology is mainly deployed in thermal power
generation and chemical production. According
to the U.S. Environmental Protection Agency
(EPA), CCS technology can help reduce 80–90%
of CO 2 emissions in thermal power plants. China
Shenhua Group began development of a CCS
project in Ordos in 2009 and has successfully
developed 300,000 tonne CCS demonstration
projects. As CCS technology gradually matures,
the coal-to-hydrogen plus CCS method of
hydrogen production will predominate, providing
sufficient hydrogen for the medium- and
long-term development of China’s hydrogen
economy.
5.2 Secondary Energy Infrastructure
Energy infrastructure is the core of China’s
energy transition. It is where change in the
energy system is perhaps at its greatest, driven by
deep integration, digitalisation and Internet
technologies. China’s energy system will focus
equally on centralised and distributed energy
production. Energy sources, networks, loads and
storage will be integrated into a single system
using multiple types of energy, which will
gradually evolve into a low-carbon, smart, secure
and efficient national energy system.
5.2.1 General Characteristics
(1) A combination of centralised and distributed energy systems
China’s future power system will comprise centralised smart grids and distributed low-carbon
energy networks. Historically, centralised production has been the dominant energy supply
mode in China. By optimising resource allocation and improving energy use efficiency, centralised supply will still play an important role in
driving China’s energy system and socioeconomic development. However, as distributed
energy systems have distinct advantages like low
transmission losses, efficiency and environmental
protection, China’s energy supply mode is
shifting from a predominantly centralised mode
to a combination of centralised and distributed
energy supply. This is an irreversible trend in
China’s energy system, and the only way to
ensure an optimised and clean energy system.
Centralised smart grids will be the platform
for optimising power resource allocation in the
long term. From the beginning, China developed
large centralised power generation facilities,
connecting them with end users through transmission and distribution systems. Thanks to
economies of scale and supply reliability, centralised power systems generally succeeded.
However, as China’s energy sources are often
located far from load centres, smart grids are
Special Report 1: A Study of China’s Energy Supply Revolution
159
supported by 3,000 km of high-pressure hydrogen pipelines. In addition, China will develop a
technical standards system for hydrogen energy
infrastructure to match those in developed
economies. And it will innovate hydrogen and
fuel cell technologies and services to support the
continued development of the hydrogen energy
industry.
In the next 3–5 years, the hydrogen energy
industry will see massive growth thanks to
extensive production, safe and large-scale storage, continuous supply, long-distance transmission and fast replenishment. Hydrogen fuel cells
and lithium-ion batteries are the two pillars of the
new energy vehicle industry. Fuel cells are being
vigorously promoted across China. For instance,
Shanghai released a development plan for fuel
cell vehicles in September 2017, which forecast
that the city will have more than 100 fuel cell
vehicle related companies by 2020 and build 50
hydrogen refuelling stations by 2025. Fuel cell
vehicle technology and manufacturing will match
international levels by 2030, and the annual output value of Shanghai’s fuel cell vehicle industry
will exceed RMB 300 billion ($43.5 billion).
(2) Coal-to-hydrogen and carbon capture and
storage will become mainstream
China has abundant and relatively inexpensive
coal resources, so coal-to-hydrogen will probably
become the main method for large-scale hydrogen production. However, the coal-to-hydrogen
process emits large amounts of CO 2 , so the use
of carbon capture and storage (CCS) technology
is necessary to reduce emissions. Currently, CCS
technology is mainly deployed in thermal power
generation and chemical production. According
to the U.S. Environmental Protection Agency
(EPA), CCS technology can help reduce 80–90%
of CO 2 emissions in thermal power plants. China
Shenhua Group began development of a CCS
project in Ordos in 2009 and has successfully
developed 300,000 tonne CCS demonstration
projects. As CCS technology gradually matures,
the coal-to-hydrogen plus CCS method of
hydrogen production will predominate, providing
sufficient hydrogen for the medium- and
long-term development of China’s hydrogen
economy.
5.2 Secondary Energy Infrastructure
Energy infrastructure is the core of China’s
energy transition. It is where change in the
energy system is perhaps at its greatest, driven by
deep integration, digitalisation and Internet
technologies. China’s energy system will focus
equally on centralised and distributed energy
production. Energy sources, networks, loads and
storage will be integrated into a single system
using multiple types of energy, which will
gradually evolve into a low-carbon, smart, secure
and efficient national energy system.
5.2.1 General Characteristics
(1) A combination of centralised and distributed energy systems
China’s future power system will comprise centralised smart grids and distributed low-carbon
energy networks. Historically, centralised production has been the dominant energy supply
mode in China. By optimising resource allocation and improving energy use efficiency, centralised supply will still play an important role in
driving China’s energy system and socioeconomic development. However, as distributed
energy systems have distinct advantages like low
transmission losses, efficiency and environmental
protection, China’s energy supply mode is
shifting from a predominantly centralised mode
to a combination of centralised and distributed
energy supply. This is an irreversible trend in
China’s energy system, and the only way to
ensure an optimised and clean energy system.
Centralised smart grids will be the platform
for optimising power resource allocation in the
long term. From the beginning, China developed
large centralised power generation facilities,
connecting them with end users through transmission and distribution systems. Thanks to
economies of scale and supply reliability, centralised power systems generally succeeded.
However, as China’s energy sources are often
located far from load centres, smart grids are
Special Report 1: A Study of China’s Energy Supply Revolution
159