China’s Smart-Grid Play: Ready To Take Off?

China is the world’s largest electricity consumer, and growing fast. That’s motivating the country’s embrace of renewable energy production, but the focus apparently isn’t only on the production side: According to a new report from the research firm Zpryme, investments over the next several years could help catapult the country to becoming the world leader in developing a large-scale smart grid system.

The Zpryme report is in line with an analysis by the Center for American Progress, which said last fall that Chinese leaders “view smart grid technology as the next industrial revolution,” and are betting that upgrading to a smarter electricity grid will drive technology innovation and move the country up the manufacturing value chain.

china smart grid

image via Shutterstock

According to Zpryme, over the next five years, the State Grid Corporation of China’s (SGCC) plans to invest more than $400 billion in power grid construction. Of that, about $100 billion will be spent on smart grid technologies. SGCC supplies power to 88 percent of China, with more than 286 million customers.

It’s that huge size, and the fact that the country is working to build all new infrastructure from the ground up, rather than trying to retrofit an old system, that could eventually mean a revolutionary nationwide smart grid system—something other nations, including U.S., are far from accomplishing. At the end of 2011, SGCC had already put in place 238 smart grid pilot projects including connecting wind power plants and installing metering systems in households, Zpryme said.

According to the SGCC, only 36 million smart meters have been installed as of 2011, Zpryme said, but the utility has plans to install over 300 million smart meters by the end of 2015. Zpryme said statistics put the number of smart meters installed in the U.S. at just over 20 million, although some see the figure closer to 30 million.

SGCC’s pilot projects were put in place across different regions of China, including a highly publicized Smart Grid demonstration project at the Shanghai World Expo. Using what it learned from these projects, SGCC released a set of industry rules, standards and favored technologies for 22 criteria of Smart Grid technology in June 2010.

Kristy Hessman is a writer and native Oregonian who currently resides in California. Before starting her own company, she worked as a reporter covering business and politics for daily newspapers and The Associated Press.