Mapping the Chinese potential

China could install much more wind power if it eased its rules governing foreign investors, says New Energy Finance (NEF), a research company. While China has set a wind target of 30,000 MW by 2020, NEF says as much as 54,000 MW could be installed by then. Europe has 45,000 MW today and the world is projected to hit 75,000 MW this year.

To reach more than 50,000 MW in China, the investment needed is so substantial that it will only materialise "if China continues to open up to the international capital markets, in particular relaxing its Qualified Foreign Institutional Investor rules," according to NEF in a report titled "Interesting Times -- Clean Energy Investment Opportunities in China." If not, China's "future flagship clean energy suppliers" will choose to make Initial Public Offerings on overseas markets.

The massive potential for wind power in China is also the subject of a report by the Delegation of German Industry and Commerce in Beijing (AHK). It points out that the granting of wind development concessions by central government -- the latest for 1000 MW of wind (main story) -- is no longer the main market driver. Around 70-80% of wind projects in China are being developed using a non-concessionary, or conventional, route to gaining power purchase contracts, says AHK in its report, "Renewable Energies in China."

Providing a detailed overview of the Chinese wind market and the key players, the report outlines what companies need to do for successful market entry. "Business opportunities for foreign companies arise mainly in providing high-end products and large sized applications," AHK says.

There are obstacles. "Foreign companies face, first of all, the challenge of assessing market potential realistically, and secondly, of understanding the roles and responsibilities of different players. Finally they must be able to get in contact with these. Information, especially on the planning and implementation procedure for renewable energy projects and on potential customers, is not easily available."