Two hundred megawatt for China

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Four wind plants with a total installed capacity of 190 MW are to be installed in China using loans from the World Bank and a grant from the Global Environment Facility (GEF). The wind farms are to be operational in the first half of next year. The announcement was made in March by China's Ministry of Foreign Trade and Economic Cooperation and carried by the official Xinhua news agency. The World Bank is the lead agency for the GEF, which makes soft loans available for environment projects.

The largest of the proposed wind farms will be the Huitengxile wind farm in Inner Mongolia, an autonomous region in northern China. It will have a capacity of 100 MW. A second, with an installed capacity of 50 MW, will be the Zhangbei wind plant in Hebei province, also in northern China. A 20 MW wind plant is slated for Pingtan in Fujian province in south east China and another 20 MW for Chongming Island in Shanghai. The Huitengxile and Zhangbei wind farms are also expected to be expanded, says the ministry.

The estimated cost will be $240 million, of which $65-120 million will be in the form of loans from the World Bank and $10 million in the form of grants from the GEF. Domestic matching funds, says the ministry, will come from "capital funds of enterprises" and will not be less than 20% of the cost of each project.

The news of the projects from China has yet to be confirmed by the World Bank. Members of the renewables project team from the bank were still in China late last month. Once built, the new wind farms will almost double China's installed wind capacity to date. It currently has 166 MW, most of which has been built in recent years.

In addition to the World Bank's innovative renewables project -- of which the wind farms are apparently part -- it is also trying to promote energy efficiency. Such World Bank-implemented projects, underwritten by the GEF and Montreal Protocol, also aim to phase out ozone depleting substances, develop natural gas, establish management of nature reserves in forests, improve ship waste disposal in ports, and foster design of small efficient boilers. Some 22% of the bank's China portfolio in 1997 went to energy projects. In addition, the bank's lending for environmental protection has become the fastest growing area of its program in China.


The news comes even as a recent report by the GEF criticises the World Bank for its renewables policies. The GEF, in an evaluation report released in March, found that the bank had actually reduced its lending for renewables projects since 1991. Indeed, the GEF concluded, the World Bank has not "taken meaningful action to reduce the impact of its traditional role as financier of fossil fuel power development." The evaluation also found "no evidence that the World Bank has made [the necessary] energy pricing and other policy reforms that would make renewable energy technologies -- such as solar and wind power -- more commercially viable as part of its energy blending strategy."

The Chinese wind farm loans also come as a new World Bank survey suggests that aid for poor countries is needed more than ever. Released last month, the survey says that 60% of the world's poor still live in just two countries, China and India, yet foreign aid spending reached an all time low in 1996 as a proportion of wealthy countries' budgets and as a percentage of gross national product. Although flows of private capital now outstrip official development aid, private markets do not supply sufficient quantities of knowledge, according to Joseph Stiglitz, senior vice president and chief economist at the bank.

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