How renewable energy is used to enhance oil and gas production-edited by Aishee Biswas

The National Energy Administration of China has announced plans to utilize renewable energy sources, such as wind and solar power, for on-site power generation in order to improve oil and gas recovery techniques. According to the NEA's action plan for 2023-2025, gas production could increase by 3 billion cubic meters through pressure-boosted mining methods. Additionally, crude oil production could be increased by more than 2 million tonnes through renewable-powered carbon dioxide flooding and thermal recovery techniques.

The NEA has also suggested that renewable energy sources could be used for increased exploration of onshore and offshore oil and gas. Northern and western regions of the country, such as Xinjiang, Gansu, and Heilongjiang, have been identified as particularly promising for the development of renewable-supported oil and gas facilities.

According to the National Energy Administration, China aims to integrate renewable and conventional energy resources to ensure energy security, including the continued use of coal. Despite the substantial increase in renewable energy capacity, traditional fuel sources such as coal remain the primary energy supply, with coal contributing to 56.2% of energy consumption in 2021. In response to power outages caused by droughts in 2022, China plans to construct approximately 100 new coal-fired power plants to complement wind and solar power, raising concerns about unprofitable power assets. To address the issue, the NEA has suggested demand-side reforms, including reducing peak-time power usage, as well as expanding energy storage and smart grid systems.

According to data from the National Bureau of Statistics, China's energy consumption was comprised of 56.2% coal power, 17.9% oil, and 8.5% gas last year.

Due to droughts in southwestern China in 2022 that reduced hydro output, power outages occurred, prompting China to plan for approximately 100 new coal-fired power plants to supplement wind and solar capacity. Concerns have been raised that this move could result in additional unprofitable power assets for the second-largest economy in the world.

 

The NEA emphasized the importance of demand-side reforms, including reducing peak-time power usage and enhancing energy storage and smart grid systems.