Beijing issues new-type energy system 15th Five-Year Plan
On June 25, the macro planner (NDRC) and energy regulator (NEA) jointly released the 15th Five-Year Plan (FYP) for the development of the new-type energy system.
The plan comes with few surprises regarding decarbonization targets and clean energy infrastructure development strategies, sticking to what's been announced in recent years.
More notable is the plan's focus on massively boosting system flexibility to help the grid integrate intermittent renewables, with 2030 targets including:
- Boosting load regulation capacity by 40%
- Increasing new-type energy storage and pumped-storage hydropower capacity to 300 GW and 160 GW respectively – massive 4.5- and 2.5-fold increases, respectively
- Increasing virtual power plant and vehicle-to-grid capacity to 50 GW apiece – roughly triple today's levels
The plan also calls for aggressively replacing oil consumption with alternatives, calling for:
- A major push to ramp up coal-to-oil/gas production capacity
- An 8x increase in green hydrogen output to 2.5 million tons by 2030, coupled with ambitious hydrogen pipeline buildout and support for downstream green fuels
- Large-scale replacement of fossil fuel-powered trucks and ships with electric and green fuel-powered alternatives
Get smart: Power system flexibility and grid capacity bottlenecks are arguably the biggest constraints on China's decarbonization potential.
- Intensified focus to resolve these issues will likely dominate China’s energy sector policymaking through 2030.
Get smarter: Accelerating industrial electrification and green fuel use are increasingly viewed by regulators as crucial both for decarbonization and as a demand sink for surplus renewables. They also have the added bonus of reducing exposure to increasingly unstable global commodities markets.
- Expect a major push on these fronts in the years ahead.