China is leading the global energy transition

There are more opportunities than challenges

“I am convinced that China is in a leading position and playing a key role in the global energy transition.”

Goofy has a keen insight into the latest developments in China’s energy transition. According to his observation, in China, new energy or “power 4.0” has begun to gradually scale, and introduce more energy storage systems to balance the entire grid. “China’s capacity to build renewable energy in 2023 is impressive, more than any other country in terms of scale of construction.”

HMS01.1N-W0054-A-07-NNNN As Goofy said, China’s renewable energy generation capacity in 2023 has historically exceeded thermal power, and more than half of the world’s new installed capacity throughout the year. This year’s “Government Work Report” further proposed to “further promote the energy revolution, control fossil energy consumption, and accelerate the construction of a new energy system.”

In addition, the “Clean Energy Market Monitor” report released by the International Energy Agency in early March this year shows that China is the global leader in the field of renewable energy, and clean energy technology continues to lead the world by a large margin. Several international think tanks and media also believe that China is a world leader in the field of renewable energy, and China is replacing carbon-based energy with renewable energy faster than many experts expected.

With the continuous advancement of China’s high-quality development, China’s energy industry is facing historic transformation and innovation opportunities. Traditional energy is replaced by new energy, energy needs to be integrated with information technology in depth and breadth, and the physical power grid should become a smart grid, but also become a digital power grid. Energy transformation is not only the low-carbon energy structure, but also involves the establishment of a new energy power system and a new operating mechanism, that is, the energy system revolution.

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On the one hand, China is investing in renewable energy faster than the global average, thanks to its scale, says Mr Goofy. On the other hand, China is also at the forefront of demand-side transformation in the transportation sector. As we all know, China has a high penetration rate of electric vehicles and a rapid spread of energy storage facilities, so it can experiment with the “future grid” on a large scale and create new solutions in a rich variety of application scenarios. In Goofy’s view, this is a great opportunity for China.

Of course, China and the world also face the challenge of “finding the right supply chain and sufficient supply capacity for the energy transition”. To truly decarbonize, electricity consumption will double, which requires the construction of an entire industrial chain. “In the future, every country will pursue electrification, which means that every country needs to ensure that it has enough production capacity.”

HMS01.1N-W0054-A-07-NNNN Focusing on the construction of the grid, Goofy believes that the current challenge is to supply power or strengthen the grid in places where there was previously less demand for electricity. For example, today’s fast charging stations along the highway, it takes 20 to 30 minutes to charge the car, and in China’s Spring Festival travel period, there will be a concentrated outbreak of charging demand in some places, which requires strengthening the construction of the power grid and energy storage utilization, to create a high toughness, high flexibility of the power grid to meet the charging needs of different regions at different times.

In addition to this, two other challenges in grid construction are the correct use of energy storage and DC systems, and the optimization of the grid’s moment-to-moment output. These challenges are not insurmountable, he argues, but require execution. Schneider Electric has a large number of products and solutions related to enhancing the security and resilience of the grid, which can ensure the security of the grid and improve the efficiency of distribution management.