(Bloomberg) -- To turn wind and sunlight into power, first you need land. Lots of land, ideally unpopulated, where you can install hundreds of wind turbines and thousands of solar panels.
Bringing all that green power to densely populated commercial centers requires something else: Thousands of kilometers of ultra-high voltage power lines, audibly buzzing with electricity.
China, the world's biggest greenhouse gas emitter, can’t meet its environmental goals without connecting its abundant sources of renewable energy with its coastal megacities. By 2030, it plans to have enough solar and wind capacity to generate 1,200 gigawatts — equivalent to all of the U.S.’s power needs. To hook that up to the grid, it's investing in a national network of power lines that by one estimate will take 30 years and cost $300 billion, compared with the recent 10-year, $65 billion allocation to grid infrastructure by the U.S. Congress.
The growing number of lines crisscrossing the country from one massive pylon to the next are expensive, noisy and, to many, a blight on the landscape. But most countries share China’s predicament. The best places to harvest wind and solar power are far away from the people who need them. As of now, ultra-high voltage lines are the only solution, and most economies are woefully behind. Brazil is the only other country to have fully functioning UHV lines, with two, and a Chinese firm built them both. China has 30.
“If you want cheap, secure and clean power, I don’t know how you get there without UHV power lines,” said Michael Skelly, a senior advisor at Lazard Ltd. in Houston and a founder of Grid United LLC, a U.S. energy infrastructure firm.
The problem is distance and storage. Coal mining also usually takes place far from urban centers, but coal and other fossil fuels can be shipped to power stations closer to cities. The power itself only travels a short distance. That doesn’t work with renewables. Wind and sunshine can’t be loaded onto trucks for delivery elsewhere.
Transmitting those electrons over thousands of kilometers requires direct current lines, the bigger the better. The higher the voltage, the less power is lost incrementally along the way. The UHV lines that run from Qinghai, Xinjiang and Yunnan to Beijing, Chongqing and Jiangsu carry the equivalent of 10 power plants’ worth of electricity. That’s why they have to be strung so high off the ground. It’s also why they’re noisy: the electric field breaks apart air molecules, which makes that perpetual zzzzz sound.
In October, President Xi Jinping announced a collection of solar and wind projects, the first phase of which will add about 100 gigawatts of power, or enough to run Mexico. Of the six interior regions that have been tapped to house a new crop of wind and solar farms, Qinghai has critical advantages. It’s windy, bright and sparsely populated. It’s also the origin of the Yellow River.
On a late September day, Yang Xueli stood overlooking the Longyangxia dam, a hydroelectric power station with an integral role to play in China’s grid. There wasn’t a cloud in the sky — Qinghai is one of China’s sunniest provinces — and the water looked green in the midday light. Fields of solar panels aren’t far, making this home to the world’s biggest combined solar and hydroelectric facility. “Water and light complement each other,” said Yang, the deputy chief of the hydro station. “When light is intermittent, we adjust with hydropower.”
Even in dry, sunny places like Qinghai, the weather can be unpredictable, and the energy generated by sunlight, like wind, varies depending on the conditions. Power from the dam is reliable, ensuring the UHV line can carry a full load of electricity. As technology evolves, Yang said, energy from renewables will supplant the need for coal.
The facility spans about 600 square-kilometers, roughly the size of Singapore. When it’s all up and running, it will generate some 18.7 gigawatts of electricity, equivalent to all of Israel’s power needs or twice New Zealand’s. It’s more than enough for the 6 million residents of Qinghai, which earlier this year became China’s first province to run on renewable power for a full month.
The cables themselves are agnostic. As of now, most of the electricity they carry is still derived from coal-fired power plants. China has pledged that all new, cross-province power lines will transmit at least 50% renewable power, according to a government roadmap published in October, which lays out how it will cap carbon emissions by 2030.
Two companies will be responsible for the buildout. The nation’s dominant electricity supplier, government-owned State Grid, has announced a $350 billion expansion through 2025 that includes — but doesn’t break out — UHVs. It already has 26 lines in operation, five under construction, and another seven planned for the next three years. By then, all of State Grid’s cross-province UHV lines will carry at least 50% clean energy, according to its plan for reaching the nation’s carbon goals published in March.
China Southern Power Grid Co, the other major operator, has four UHV lines and plans to spend just over $100 billion on expanding its network through 2025, though it didn’t detail its specific investment in UHV.
Both grid operators declined interview requests for this story, and the National Energy Administration, which is expected to publish its latest five-year plan for the power grid in this month, couldn’t be reached for comment.
There will be other winners too: Wind and solar firms that already dominate global renewable energy; makers of grid and power storage equipment; the commodity traders who supply the copper that's used to conduct electricity. Shanghai-traded shares of Nari Technology Co., the equipment-making subsidiary of State Grid, more than doubled in the past year and are poised to keep climbing, analysts say. Sieyuan Electric Co., an electric component manufacturer, power distributor State Grid Information & Communication (SGIC), and TGOOD Electric, a transformer maker, are favored to outperform.
Detractors don’t like the cost of the UHV network, and it is possible as-yet undeveloped technology could cut short the return on the significant investment. China’s lines have also suffered from low utilization rates. Grid operators and the government are trying to sync up the development of new power generation with the construction of UHV lines that will accommodate a larger portion of clean energy, according to BloombergNEF analyst Lin Wang in Beijing.
There’s no shortage of demand. A lot of global companies that operate in China have set hard deadlines for using 100% clean energy, said David Fishman, an analyst with The Lantau Group based in Hong Kong. “If you’re in southern or eastern China, and you have ever-increasing renewable energy demand but are limited by your ability to install, UHV is your only access to renewables,” he said.
In the U.S., where massive power outages have grown more frequent and widespread in recent years, similar efforts to establish a national grid have foundered. Skelly founded Clean Line Energy in 2009 and raised $100 million to plan five high-voltage lines to carry wind power from the Great Plains to cities thousands of miles away.
The lines were popular with wind farm developers in Oklahoma and Kansas and offered power to major cities like Memphis at rates lower than what they were paying nearby coal plants. But they faced opposition from landowners and state regulators along the routes, and the resulting delays eventually forced Clean Line to sell off the projects and fold.
This is a common roadblock for UHV projects. Because the lines are so long and deliver few tangible benefits to the towns along the way, it’s easy for projects that need incremental, local approvals to stall. People in China’s fly-over towns don’t love the plans to put massive electrified towers in their midst, but Beijing has prioritized the net-zero goals, and the projects have pushed through.
A 28-year veteran of China’s power industry, Yang lives in a nearby compound that houses some 100 dam workers, mostly men. The dam, he says, is critical for irrigation in the Yellow River basin and, along with solar, to the steady supply of clean energy that will protect the environment in the long run. “We are very excited,” he said.
Someday, Yang’s facility could become a feeder for a regional grid, or a global one. Given regional politics and individual countries’ domestic concerns, the idea seems like a longshot. But several cross-border projects are in development in Europe and Asia, and earlier this year, Skelly founded a new company dedicated to long-haul, high-voltage transmission of renewable power.
“It’s not like we’re going to decide overnight: ‘Let’s make a global grid,’” he said. “When they laid the first trans-Atlantic telegraph cable, they weren’t planning to connect the whole world. But you turn around 100 years later and the whole world is connected.”
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