Despite these favorable factors and progress, the foremost challenge for countries to achieve decarbonization is to unlock what energy experts call the “energy trilemma.” The term refers to the difficulties in obtaining cheap, stable and clean energy simultaneously, given the innate unstable nature of sustainable power sources, particularly solar and wind.
“It is relatively easy to install solar and wind power plants,” Zou Ji said, “The difficulty lies in how to utilize their power capability.” Although China has accelerated solar and wind power installation in recent years, the utility ratio has been relatively low.
According to data released by the National Energy Administration, while installed solar and wind power capacity in the first three quarters of 2023 accounted for 33 percent of China’s total power capacity, solar and wind accounted for only about 16 percent of its total electrical generation, meaning that only about half of the country’s solar and wind power capacity is effectively utilized.
By comparison, data released by US energy authorities showed that over the same period, solar and wind accounted for 18.6 percent of the country’s power capacity and 15.5 percent of total electricity generation, indicating a much higher utilization ratio of 83 percent.
According to energy experts, the US achieves these higher rates by utilizing natural gas to mitigate the intermittent gaps in solar and wind capacity. Though a fossil fuel, natural gas power can be quickly brought online or taken offline, unlike coal power, which China heavily relies on.
“Gas power plants can respond more quickly to fluctuations of power generation [than coal], making them a safer and more environmentally friendly backup option,” said Sun Rongfeng, a research fellow from the Energy Research Institute of the Shandong Academy of Sciences.
Additionally, the US benefits from a more market-oriented energy pricing mechanism. In 2022, natural gas accounted for 39.9 percent of electricity generation in the US. The energy landscape differs greatly in China, where in 2022 natural gas accounted for only 3.3 percent. Coal dominated power generation at 58.4 percent.
Experts argue that a more competitive energy pricing mechanism incentivizes greater use of renewables. For example, electricity in the US is generally more expensive during peak load times. Such time-based pricing mechanisms factored heavily into the rapid growth of residential and commercial PV power.
Zou Ji pointed out a pricing hurdle for China: While fierce competition in technology and manufacturing have driven down new energy prices on the supply side, energy prices remain relatively fixed on the demand side. China’s power grid system is monopolized by just a few centralized State-owned grid companies.
Sun explained that while rooftop solar is popular in rural areas, China’s grids often cannot cope with the intrinsic instability of these installations. This means households can only utilize about 30 percent of the electricity they generate. The remaining 70 percent is effectively wasted.
Sun added that China needs to seek a market-based solution to improve new energy’s access to the grid, as the generation cost of renewable energy has become lower than that of thermal power.