To increase the level of renewable energy consumption in China the country is to be invest 1.5 trillion yuan (US$187.5 billion), said Wu Guihui, vice-director-general of the Bureau of Energy under the National Development and Reform Commission.

Currently 7.5 percent of China's energy comes from renewable sources. The country's aim is to make this 10 percent by 2010 and 16 percent by 2020. The initial 2020 goal had been 20 percent but was revised.

"Within 10 years we'll see a population of 30 million in all the remote rural areas have access to electricity mainly from renewable energy-powered projects," Wu told the Great Wall World Renewable Energy Forum and Exhibition on Tuesday in Beijing. "The shortage of fuel for daily consumption in rural areas will also be solved by that time," said Wu.

The country would promote the development of the renewable energy industry, introduce advanced foreign techniques and further develop technology with proprietary intellectual property rights.

Hydro-powered electricity capacity would rise from the current 117 million kilowatts to 190 million in 2010 and 300 million in 2020 when 70 percent of the nation's potential hydroelectric energy would be exploited, Wu said.

From 2002 to 2004 China spent 4.7 billion yuan (US$587.5 million) on small-scale hydropower systems intended for rural areas. Today they serve more than 5 million people in 12 provinces and regions.

Meanwhile the capacity of biomass power will reach 5.5 million kilowatts in 2010 and 30 million in 2020. For wind power it'll be 5 million kilowatts in 2010 and 30 million in 2020.

"A group of major hydro-power bases will be established along major rivers," Wu said. "Scores of wind power plants, each with a production capacity of 1 million kilowatts annually, will be set up along the eastern coastal areas and northwestern and northern China."

Solar energy would be extensively used in remote rural areas to heat water and cook. As the world's leader in the use of solar cells China would increase the total area of such cells to 300 million square meters by 2020.

"China has made some progress in the renewable energy sector but is still in the initial stages," Wu said.

Hydropower produced 400 billion kilowatt-hours last year, 16 percent of China's total consumption, with the Three Gorges project generating 48.6 billion kilowatt-hours. It's expected to generate 84.7 billion annually when complete in 2009.

But Wu said, "Two-thirds of water resources remain unexploited. In the hydro-power sector we are facing challenges including environmental protection and the relocation of residents. China lags far behind Europe and the US in developing wind power though it's a wind-rich country."

Half of China's cars will use cleaner fuels such as energy-efficient diesel, gas and bio-fuel by 2025, said an official Wednesday. Renewable and low-emission energy sources would replace traditional gasoline to drive future Chinese vehicles, said Feng Fei, director of the industrial economics research department with the Development Research Center of China's State Council, at a seminar.

"Bio-fuel and hydrogen are the ultimate substitutes for fossil fuels," said Feng. He added that fossil fuels would remain the major source of energy for Chinese cars but by 2030 cleaner forms of these would take lead.

Feng dismissed oil produced from coal, which has been developed rapidly in recent years, as a major alternate energy source for automobiles. "The biggest problems of turning coal into oil are its low energy efficiency and high emission of carbon dioxide in the production process," said Feng.

Three to five tons of high-quality coal were required to produce a ton of diesel bringing energy consumption to two to three times that of gasoline-driven cars. The burning of the fuel emits 50 to 100 percent more carbon dioxide than that of gasoline.

With a larger reserve of coal than oil China could make oil from coal as part of the country's strategic reserves but large scale production was against the country's goal to improve the efficiency of energy use and cut pollution, said Feng.

China has confirmed oil reserves of 24.8 billion tons and coal reserves of more than one trillion tons. The Shenhua Group, the country's top coal producer, plans to invest in three projects from 2011 to 2012 to generate 10 million tons of oil from coal.

It's estimated that China will need 450 million tons of petroleum a year by 2020 with more than half of that being imported.

(China Daily, Xinhua News Agency October 26, 2006)