The research arm of American banking giant Goldman Sachs has concluded that China is currently on track to generate almost three times more power from wind turbines and solar panels than the government has targeted.
According to a report published by Goldman Sachs in late March, combined capacity from China’s solar and wind energy sector will reach 3.3 terawatts (TW) by 2030.
This far outstrips the Chinese government’s current target of 1.2TWh.
The conclusion from the report is that, with such an accelerated pace for wind and solar deployment, China could become energy self-sufficient by 2060.
“As China focuses on the challenges to reduce imported fossil fuels, we view an affordable renewable energy system, equipped with sufficient energy storage and smart grid transmission, as China’s long-term solution to achieving energy self-sufficiency,” Goldman Sachs analysts Nikhil Bhandari, Amber Cai, Chao Ji, and Chelsea Zhai write in the report.
As regards China’s energy self-sufficiency, Goldman Sachs expects the country’s progress on renewables to help reduce its energy imports by 10% by 2030, though this would “be just the start”.
Looking out further, Goldman Sachs analysts expect a 50% cut in energy imports is possible by the early 2040s if renewable installations accelerate on track with their forecasts.
In turn, Goldman Sachs expects that, due to renewable cost innovations, the pace of China’s deployment of wind and solar will ultimately lead to lower energy costs for consumers.
However, to get there, China will need to invest $US2.26 trillion by 2040 in both renewables and grid storage.
Specifically, China will require around 520GW of storage, of which more than three-quarters will need to come from batteries – 70 times greater than in 2021 – with the remainder from pumped hydropower stations.
“We expect a smart and well-connected grid to become a core component of China’s ‘Energy Internet’ — a modernized power system that integrates different types of power resources and enables large-scale, interactive energy transmission and transaction,” the authors write.
“As the Energy Internet expands, we expect it to enable more innovative power and transmission solutions such as virtual power plants, big data analytics, and in-time power dispatching, which in turn allow an even higher share of green power in the generation mix.”
Of course, if investment does not meet the forecasts and expectations of the Goldman Sachs reports, China may not reach these dizzying heights. However, of all the countries currently investing in a green energy transition, China has both the resources and willpower to climb the potential heights in front of them.
