Renewable Energy and the PLA’s Next Generation of Self-Sufficiency (Part 1)

Renewable Energy and the PLA’s Next Generation of Self-Sufficiency (Part 1)
Photo Credit: AP/達志影像 

What you need to know

This is the first in a two-part series on Chinese energy security and renewable energy.

In December 2016, China unveiled one of its most ambitious renewable energy (可再生能源) initiatives thus far with plans to invest over $360 billion as part of the Chinese National Energy Administration’s (NEA) new “Thirteenth Five-Year Plan” (可再生能源發展”十三五”規劃以實) (NDRC.gov, Dec. 2016). This initiative promotes the adoption of more non-fossil energy sources by 2020 and will be a benefit not only for the soot and smog-cloaked cities of China, but also create up to 13 million jobs, conserve scarce resources such as water, and buoy the flagging Chinese renewable energy sector (National Energy Administration of China, Jan. 5). While this announcement garnered praise from the international community, a second announcement a few days later for the Implementation Plan for Frontier Power Grid Construction that ties in the Chinese constabulary and military forces went largely unnoticed (China News, Jan. 10).

This joint plan between the NEA, the Logistics Department of the Central Military Commission (CMC), and the China Southern Power Grid Company aims to resolve the “electricity problems” of the PLA and the Border Defense Force by 2020 (NEA; China Southern Power Grid Company, [accessed Feb. 10]). Zhao Keshi (趙克石), a member of the CMC and director of the Logistics Department of the CMC, asserted that President Xi Jinping (習近平) conceives of energy construction as an integral part of the national security plan to include expansion and construction of more renewable energy resources. Additionally, Zhao identified two important and ongoing trends in his remarks: the revolution in national energy and the full integration of civilian and military (civ-mil) development, that will enhance the Chinese “wartime ability to fight.” From Zhao’s comments, it would appear that China is securitizing renewable energy, as part of a broader energy strategy (能源戰略). But before the military role in renewables can be assessed, it is essential to examine some key aspects of renewable energy.

Primer on renewable energy

China has relied primarily on fossil fuels for its energy needs. With the exception of hydropower (水电) harnessed from its large network of dams and extensive historical use, alternative energies were largely unknown in China until the mid-1990s. Renewables slowly gained prominence as technologies were transferred to China through business ventures and research conducted in Western corporate and university laboratories. Later, this transfer of renewable technology increased rapidly as Chinese companies merged and acquired Western companies, or through their own internal research and development efforts. State-owned energy providers then tapped into renewable companies as part of their energy production portfolio. As a result, a mix of both private and public Chinese entities are now heavily involved in the renewable energy sector.

Recognizing the potential and necessity of renewable energy, the Chinese government has funded renewable energy initiatives and research, such as the Chinese Meteorological Administration’s Wind and Solar Energy Resource Center(中國氣象局–風能太阳能資源中心) (CMA, Jan. 10). China now harnesses a wide variety of renewable energy sources, from biomass (生物質發電), to wind power (風電), to ocean energy (海洋能), to solar power. Greenpeace estimates that China installed an average of one wind turbine every hour of every day in 2015 and covered the equivalent of one soccer field every hour with solar panels (Greenpeace, Jan. 10). However, renewable energy sources are unequally distributed across China. While solar power is ubiquitous and the most accessible throughout China, hydroelectric power generation, such as the Three Gorges Dam (三峽大壩), is severely limited to rivers and lakes. The same is true for ocean energy generation along the coast and wind power. Interestingly, wind energy could play an integral part in power generation for military and constabulary forces positioned in the restive and contentious areas within and bordering China. This is because the strongest and most effective wind currents for capturing energy are located primarily in the west, in Xinjiang and Xizang, or along the southeastern coast, adjacent to Hong Kong, the South and East China Seas, and Taiwan.

Yet, China’s successes in renewable energy have not gone unnoticed. A few years ago the U.S. State Department launched a series of collaborative efforts between American and Chinese companies. However, there have been a string of high-profile events that have diminished the prospects for future cooperation. Primarily, a downturn in renewable energy sector dampened global enthusiasm in the early 2010s. This was followed quickly by multiple lawsuits against China. In 2012, America sued China in the WTO for dumping solar panels on the American market (Reuters, [accessed Feb. 17]). Meanwhile, Beijing’s Sinovel Wind Group was sued in both American and Chinese courts by its previous wind turbine software supplier, Massachusetts-based AMSC, for “unauthorized” use of AMSC’s proprietary software (Bloomberg, [accessed Feb. 27]).

The Chinese military is not the first or only to explore renewables. The U.S. Navy has invested heavily in biofuels as part of the “Great Green Fleet” initiative, while the Department of Defense has invested in a variety of programs (U.S. Navy, Feb. 17; DoD-NREL, Feb. 17). However, China has sought to expand the use of renewables both at home and abroad, especially where it is making strategic leasing arrangements. A recent article in the Natural Science Edition of the Journal of Xiamen University by both PLA University of Science and Technology and the Dalian Naval Academy personnel assessed the potential for wind power generation in and around the Gwadar Port area in Pakistan, site of a future PLA-Navy base (Chinamil, Dec. 1, 2016). As the article points out, the researchers hoped their efforts would promote sustainable development in Gwadar and provide a “demonstration” for Chinese projects abroad. In addition, the report’s release coincided with an infusion of more than US$500 million by China into renewable energy resources in Pakistan through the China-Pakistan Economic Corridor, a US$45 billion dollar agreement to build infrastructure projects which include wind and solar ventures (CEPEC News, Feb. 23, 2016). In the future, it is likely China will deploy renewables to other recently established leases in the Maldives, Djibouti, or one of its many land-based satellite tracking stations. In another study, personnel in Xi’an at the PLA’s Construction Engineer Research Institute and the Energy Evaluation Center for Building tested energy-saving techniques in residential buildings that can be cross-applied to commercial, industrial, or military facilities. This civ-mil component in China’s renewable energy sector cannot be understated.

Civil-military integration in renewables

China’s 2015 Military Strategy contends that accelerated civ-mil integration will be key to unspecified, sectors. To aid civ-mil cooperation, “stronger policy support” will be initiated to “establish uniform military and civilian standards for infrastructure, key technological areas and major industries . . . It is also necessary to push forward with the shared utilization of military capabilities and those of other sectors” (Defense White Paper, May 29, 2015). As such, the overlap in civ-mil cooperation is manifest for a number of reasons. First, it is important to point out that renewable energy systems can be easily replicated and applied by both government and commercial entities, respectively called government off-the-shelf (GOTS) or commercial off-the-shelf (COTS). Second, a number of key figures in the renewable energy sectors have backgrounds in the Chinese military and maintain close relations with military industries and government, paralleling the civ-mil integration that the 2015 Military Strategy commands. Three are particularly noteworthy: one in solar, one in the broader renewable energy portfolio, and one in wind.

Miao Liansheng (苗連生) spent 13 years as a PLA soldier, but now leads Yingli Green Energy Holding Co. Ltd., a New York-listed solar company. Miao’s hometown of Baoding, about 100 miles southwest of Beijing, is the “nationally designated alternative energy production base.” [1] Both the Chinese and American Yingli websites tout Yingli as the world’s leading producer of photovoltaic (PV) modules with nearly 65 million produced thus far (Yingli Solar [accessed Feb. 10]). Another leader in solar power, Zhu Gongshan (朱共山), the founder of GCLPoly, has one of the longest and most diverse histories in the energy sector. Zhu began with the construction of a thermal power plant in Taicang in 1996 by teaming up with Kong Continental Mariner Investment, whose largest shareholder was the powerful Poly Group. Historically, Poly has maintained close ties with the PLA and Deng Xiaoping’s family. In 2006, Zhu transitioned to renewables. Rather than follow other Chinese companies’ lead and focusing on downstream production, Zhu started by producing polysilicon, the raw material of PV panels. After success there, he transitioned again to solar power plant construction and silicon wafer production in 2009. This time he received an investment of US$700 million by the government-backed sovereign wealth fund, China Investment Corporation.

The same civ-mil connection is present in the wind sector. Zhang Chuanwei (張傳衛) served 10 years in the PLA before starting Ming Yang Wind Power Group. He is noteworthy for pioneering turbine leasing by partnering with the Chinese bank ICBC and intends to make Ming Yang the global leader in offshore wind power through more integrated turbines, energy storage, and grid technology.

However, China’s heavy civ-mil relationship in renewable energy has not gone unnoticed, especially in the U.S. In 2010, Congress launched an investigation when it was discovered that Suntech, with ties to the PLA, was the largest supplier to a solar plant at Nellis Air Force Base in Nevada. As a result, Congress inserted Sections 846 and 858 into the 2015 National Defense Authorization Act that prescribed that the Defense Department comply with the Buy American Act when purchasing most photovoltaic devices, effectively shutting out Chinese suppliers. In 2012, the Obama Administration with the backing of the Committee on Foreign Investment in the United States (CFIUS) blocked construction of a wind farm adjacent to a sensitive U.S. Navy development facility in Oregon. While China Daily did not specify, Reuters pointed out the direct connection between Ralls Corporation, its parent company (Shanghai-listed Sany Heavy Industry Co.), and Sany’s chairman Liang Wengen (梁穩根), previously a senior representative to multiple Chinese National Congresses (China Daily, Sept. 29, 2012; Reuters, Sept. 29, 2012). The PLA’s role in China’s energy development and strategy is less surprising given China’s larger energy security issues.

Chinese energy strategy

Graduate research by Yuan Weicheng from National Taiwan University identifies six dilemmas that China faces with regards to its energy security. First, China inordinately focuses on the coal industry which distorts broader economics. Second, China’s large imports of oil and gas are beholden to political risk. Third, these imports traverse vulnerable, strategic sea-lanes, such as the Malacca Straits and the Horn of Hormuz. Fourth, Chinese state-owned energy enterprises are split by political factions and rife with corruption. Fifth, it is difficult for China to maintain its strategic oil reserve up to the International Energy Agency’s recommended 90-day limit. Finally, China’s energy demand is causing widespread environmental devastation as well as associated social distortions. As Yuan points out, in 2013, the 3rd Plenary Session of 18th Communist Party Congress rolled out reforms, spearheaded by the Central National Security Commission and the Central Leading Group for Comprehensively Deepening Reform to address these six dilemmas.

In his assessment, Yuan contends that Xi’s emphasis on energy security is a national, global, and strategic issue. First, politically, Xi needs to combat the powerful oil clique and ratchet down corruption of the state-owned energy enterprises. Second, China should promote the transformation of its energy infrastructure and revolutionize its energy sector to promote economic growth, diversity, and sustainability. Third, China should deepen foreign energy cooperation initiatives through diplomatic means, such as “One Belt, One Road” and the Asian Infrastructure Investment Bank. Fourth, China should develop fossil fuel alternatives to not only lessen the detrimental environmental impacts they cause but also to alleviate the negative social distortions they create. For example, spontaneous local environmental protests have increased in frequency throughout China over the last few years to the chagrin and concern of China’s leadership. Fifth, the PLA will play a pivotal role in both protecting China’s oil reserves and securing China’s vital and strategic energy routes that span from Africa to the South China Sea. In conclusion, China, under Xi’s leadership, will adopt a more proactive and comprehensive approach to energy strategy in response to its unfavorable condition. Indeed, this transformation has begun and is manifest in some recent, renewable-focused activities by the PLA.

Conclusion

The deep connections between China’s energy sector and its government are not entirely new or novel. However, what is unique is how these connections have emerged in the emergent renewable energy sector. Broadly, China’s embrace and advancements in renewable technologies and techniques over the past two decades has been remarkable. Amid the background of globalization, China now has mastered a sector begun and largely driven by foreign competitors. Indeed, the tables have turned. As the previously mentioned dossiers indicated, the PLA has played an important, albeit understated role as an incubator and financier for some of the leading commercial efforts in renewable energy. The next article in this series will examine the role of the PLA in China’s national energy strategy.

The News Lens has been authorized to republish this article from The Jamestown Foundation’s China Brief. China Brief is a primary source of timely information and cutting-edge analysis for policy-makers, intelligence and military personnel, academics, journalists, and business leaders.

Editor: Edward White