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Empowering China's Green Growth

May 31, 2011

China is leading the production of renewable energies. Solar and wind electricity generation in the country is rapidly expanding with the support of the Government and of international organizations such as the World Bank..

World Bank Group

  • Over the last five years, China has increased its renewable energy generation to 8.8% of total primary energy consumption, making it one of the world’s leading producers.
  • China is aiming to reduce its carbon emission intensity by up to 45% by 2020 – compared to the level in 2005. Renewable energy will be an important part of the solution.
  • For the past decade, 90% of the Bank's energy investments in China have supported the development of renewable energy and the acceleration of energy efficiency.

Beijing, CHINA, May 31, 2011 – Lin Xiuxin, a 67-year old retired farmer living on Pingtan Island, in Southern China’s Fujian Province, says his electricity use has tripled in recent years. Thanks to the paychecks sent by his son, who works in a city, Lin is enjoying more amenities at home – a TV set, a refrigerator and a rice cooker. 

In China, as more people like Lin move out of poverty and with continued strong economic growth, the country’s energy consumption is rising 12% annually. While 70% of the nation’s power generation is still coal-fired, renewable energy has been making important advances.

Over the last five years, China has installed almost 45 gigawatts of wind power and has become the world’s biggest manufacturer of wind turbines and solar panels.

The World Bank is supporting the country’s efforts to meet its growing energy demand while reducing environmental impact.

Measurable Results

Lin’s house is powered by the giant wind turbines of Longyuan Pingtan Wind Farm, which produces about 300 GW hours annually, The farm is part of the Bank-funded China Renewable Energy Scale-up Program (CRESP), which began in 2005 to support expansion of wind, biomass and small hydropower pilot projects. It also supports institutional development and capacity building for renewable energy in China. 

“The development of wind farms involves substantial human resources and financial investment, which may limit a company’s wind power development plan,” said Liu Xiaochun, a manager at North Longyuan Wind Power Corporation. “But with support from international organizations like the World Bank and GEF, we can start the work more quickly.”

Besides financing enterprises, CRESP also helps set standards for the industry by establishing certification and testing centers. “With the support of CRESP, the certification capacity of CGC (China General Certification Center) was significantly improved, both in terms of hardware and software,” says Qin Haiyan, general manager of CGC. “With this increased capacity we are able to provide a better certification service to enterprises in the renewable energy sector.”

“CRESP introduced international best practices in developing renewable energy and by adapting international best practice to the Chinese situation, we have developed a series of incentive policies to promote technology improvement and industry development. This has laid a solid foundation for the scale up of renewable energy,” says Shi Lishan, deputy director general of the New and Renewable Energy Department of the National Energy Administration.

Sustained Efforts

CRESP followed the implementation of the Bank-supported Renewable Energy Development Project (1999-2008), which:

  • Provided electricity to about 2 million poor people in western China through the purchase of 400,000 household solar energy systems comprising about 9.2 megawatts
  • Initiated one of the first large-scale, on-grid wind power projects
  • Introduced market frameworks for commercialization of the Photovoltaic sector 

As a result of the program, solar business owner Zhang Jiang in Inner Mongolia has 2,000 customers in the region. “Farmers and herdsman like the technology. But it is quite expensive,” he says. “With support from the program, they can afford the system and thus enjoy the benefits of modern lighting.”

“Over the last decade 90% of our investments in energy in China have been to support the development of its renewable energy and accelerate energy efficiency investments,” says Dejan R. Ostojic, sector leader for energy in the East Asia and Pacific Region of the World Bank.   

The Bank has also provided analytical and advisory services in renewable energy for China, including two reports: Meeting the Challenges of Offshore and Large Scale Wind Power - Strategic Guidance and Regulatory Review of Wind in Five European Countries; a study that compiles international and national experience in biomass power generation projects; and a policy note on future directions in renewable energy and energy efficiency for China’s 12th Five-Year-Plan (2011-2015). 

Future Plans

The newly approved 12th Five-Year Plan for China’s development calls for an increase in the proportion of non-fossil fuels in total primary energy consumption to 11.4%.

As the country is working extensively on improving the regulatory and policy environment for investment in the renewable energy sector, “the World Bank is a longstanding partner supporting China to move toward a sustainable energy development path.” says Gailius Draugelis, a Senior Energy Specialist with the Bank based in Beijing.

CRESP will close in September, but a second phase of the project is being planned to address challenges like cost reduction, efficiency improvement and grid integration.