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China beefs up clean energy drive -

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ALI MOORE: Deep divisions remain between the developed and developing world over cuts to greenhouse

The draft deal at the Bali climate change conference has raised the bar for developing nations,
calling for powerhouses like China and India to measure and verify their cuts to CO2, and to do a
lot more to stop deforestation, and encourage clean economic growth.

Both countries, as well as the United States, are opposed to legally binding cuts.

But China, believed to be the second biggest polluter after the US, has already stepped up its
effort to stop the planet's warming.

Last year it spent more than $8 billion on renewable energy, and official policies could see it
transform itself into a clean energy superpower.

This report from the ABC's China correspondent Stephen McDonnell.

STEPHEN MCDONNELL: With more than 10 per cent annual growth over the past decade, China's
development moves at break neck speed.

The economic benefits are there to be seen in the bulging cities. But so are the environmental
pitfalls, and especially the greenhouse gas emissions.

YANG AILUN, GREENPEACE CHINA: Whether or not the global fight against climate change could succeed
to a large degree depend on whether a country like China could successfully take up another way of
development pattern.

STEPHEN MCDONNELL: With 70 per cent reliance on coal fired power, massive carbon emissions have
been the price China has paid to fuel its unprecedented capitalist expansion.

PAULO FERNANDO SOARES, SUZLON ENERGY: Unfortunately, due to things done in the past, seven of the
10 most polluted cities in the world are located here in China. But I do think that the Government
is trying to the possible limit to, let's say, correct this situation.

STEPHEN MCDONNELL: At this year's Communist Party congress, President Hu Jintao let the faithful
know that tackling climate change is now high on his government's agenda.

HU JUNTAO, CHINESE PRESIDENT (TRANSLATION): We will enhance our capacity to respond to climate
change and make new contributions to protecting the global climate.

YANG AILUN: If China is serious about doing something for climate change, it has to de-link its
economic growth from the consumption of fossil fuel, especially coal.

STEPHEN MCDONNELL: Greenpeace has been critical of China's heavy reliance on coal but recently it's
also become an unlikely supporter of the Government's climate initiatives.

YANG AILUN: For example, the Chinese Government made a target that by the year 2010 it want to
close down 50 gigawatt of the least efficient coal fired plans. That put together could be about
1,000 of those small coal fired plants in China.

STEPHEN MCDONNELL: It's not very well publicised in the Western world, but China has imposed on
itself huge environmental targets - well above what it's required to do under the Kyoto protocol.

PAULO DERNANDO SOARES: China has a target for wind power installed capacity by 2010, it's five
gigawatt, by 2020, a 30 gigawatt. This target is going to be easily surpassed.

STEPHEN MCDONNELL: Suzlon Energy is building wind turbine s close to Beijing. The international
company has been a direct beneficiary of the Chinese Government's decision to get into renewable
energy quickly. Its CEO is Paolo Fernando Soares.

PAULO DERNANDO SOARES: In 2005, in August when we took over, we had three employees. That was all.
Today is barely two and a half years after, we have 1,200 employees. We have seven contracts, we
have about 400 megawatts of wind farms being developed. I think this

would be almost impossible anywhere else but here.

STEPHEN MCDONNELL: Wind power in China is nothing short of a boom industry. Last year, it grew by
100 per cent. This year, it's expected to do the same.

By 2020, another electricity will be generated here from wind alone to power all of Australia. But
in China, it's not enough.

PAULO DERNANDO SOARES: There is no denying that the coal is an abundant resource here. It's
available and cheap and the main focus must be to improve the technology in the use and exploration
of coal.

STEPHEN MCDONNELL: China's current reliance on coal fired power is enormous. So many
environmentalists want to clean up existing power stations immediately because getting rid of coal
would be such a long process.

This is Beijing's oldest power station. It's been generating since 1919 and is still the city's
largest. If coal fired power is going to be cleaned up, it's in places like this it will have to

The Beijing Jingong power plant thermal power plant has four 200 megawatt turbines. It takes a lot
of coal to keep them turning.

WU QIULIN, POWER PLANT ENGINEER (TRANSLATION): Every day we use as much as 10,000 tonnes of coal,
which generates around 15 million kilowatt hours. We produce about six per cent of Beijing's
electricity capacity.

STEPHEN MCDONNELL: Not so long ago this plant pumped whatever it liked into the air.

Now filtration systems have been put in place at a cost of $123 million.

But even to the naked eye there are still impurities spitting out into the air. The company
wouldn't sell us what this black substance was.

Clearly a lot more has to be done.

The NSW city of Newcastle is a long way from Beijing. But it's here that an Australian device is
being tested which China hopes could drastically reduce its greenhouse emissions.

PAUL FERON, CSIRO: Every week a new power station is being put into operation in China.

And this technology can reduce the emissions by 90 per cent from such a power station. So the
potential for this technology to reduce CO2 emissions in China is immense.

STEPHEN MCDONNELL: The CSIRO has signed an agreement to test run its post combustion capture device
at the Huaneng Beijing power plant next year. Its proponents say it sucks most carbon dioxide from
the emissions.

PAUL FERON: In a fossil fuel based power system it could lead to emission reduction s overall to 90
per cent.

STEPHEN MCDONNELL: But this is very expensive technology in its developmental stages. It could be
at least a decade before it becomes available commercially.

Within the next three years, China is projected to avoid at least 200 million tonnes of greenhouse
gas emissions.

This is the same as shutting down all of Australia's power stations for a year.

PAULO DERNANDO SOARES: China is making a huge effort in shutting down old coal fired power plants
and building new ones which are more effective. I think the difference is the size of the problem
here is just so massive that it will take some time until people recognise and can

see this effort reflected in real results.

YANG AILUN: China is faced with a huge challenge but at the same time great opportunity. If China
can actually seize this opportunity, then China is well placed to become the world's leader in
green development and renewable energy industry.

ALI MOORE: Steve McDonnell reporting from Beijing.