The key areas involved in the strategy to ensure sustainable use of natural resources

It is imperative that we have a strategy for using resources sustainably if China is to move toward a high-income society. The country is begiiming to take hold of the enormous opportunities presented by scientific and teclmical innovations and the resource revolution. It is taking the path of a ‘new form of urbanization’ that is both intensive and highly efficient in terms of resources. It is developing a resource-conserving, environmentally friendly society as it moves toward ‘green growth’ and is lifting levels of both efficiency and effectiveness in the use of resources. It is also improving measures that safeguard the resources it will need to carry out its modernization.

Promoting advances and innovations in science and technology

Science and technology are the primary productive forces. At the end of the day, resolving resource issues is going to have to depend on technological advances and innovations. These not only can discover and make use of new resources and improve the efficiency with which resources are used, but they can even instigate a ‘resource revolution’ as well. They have a very positive impact on all the links in the chain of using resources, including production, distribution, and consumption. We therefore must establish and improve on institutional frameworks that support the various areas and links in the process of using resources so as to lift levels of sustainable use in the future.

Advances in science and technology are spurring a ‘resource revolution.’ Scientific advances are constantly discovering new resources that are injecting new forces into the development of humankind. New resources can be divided into two major categories. The first includes resources that exist in nature in then original state. Various limiting factors have made it hard for humankind to exploit these, but science has enabled their large-scale utilization. Looking at humans’ history', a number of natural resources have come to be exploited and used due to advances in science, including fossil-fuel energy sources, such as making charcoal from wood and natural gas out of oil and including such renewable energy sources as wind and solar (see Box 3.2). In recent years, breakthroughs in horizontal drilling and high-pressure fracking technology are enabling the exploitation of shale gas, leading to the large-scale economical use of this revolutionary new resource (see Box 3.1). The second major category' of resources involves things that did not exist in the natural world but that are created or transformed by man through scientific advances. Such completely new resources include artificial high-performance materials, new species created through man-made genetic technology, and secondary forms of energy created through various forms of processing, such as some kinds of electricity, ethyl alcohol, and biogas. The discovery and use of new resources have brought about major changes in human production and consumption patterns, and have far-reaching implications for economic and social development. Future breakthroughs in unconventional technologies promise to create more room for humans to develop and use resources, including new forms of energy, new materials, and deep-sea- and deep-land-based mining.

Box 3.1 The shale revolution and flammable ice

Shale gas and shale oil are natural gas and crude oil that are trapped within shale formations. Shale consists of stratified sedimentary rock that is porous and easily fragmented. In the past, no low-cost method of extracting the oil and gas in its fissures was available, but technological advances since the 1980s now allow highly efficient extraction by forcing water into the cracks in a process known as hydraulic fracking. The advances have accelerated the extraction of shale oil and shale gas.

As tlie primary technology involved, hydraulic fracking is essential for the extraction of shale gas and shale oil. The technique involves injecting pressurized liquid consisting of water, sand (as a support medium), and a small quantity of chemicals into shale formations. Sand in the water prevents cracks from collapsing, allowing the stable extraction of the oil and natural gas.

New extraction technologies have made it possible to mine shale gas and oil in a cost-effective way, while the extraction had been prohibitive before. The output of these two has risen dramatically in the United States as a result, allowing that country to realize the goal of ‘energy independence’ that was set up in the Nixon era. From being a net importer of energy', the United States has been transformed into a net exporter, which has profoundly changed the global pattern of energy supply and demand. It has also had a far-reaching effect on global manufacturing. As a result, this major technologically driven change is being called the ‘shale revolution.’ It is worth mentioning that the innovative technologies and production breakthroughs of the shale revolution were achieved by many risk-taking small and medium-sized companies in the United States.

Flammable ice, also called methane hydrate, is an ice-like crystalline substance made of water and gas that forms at very low temperatures and under high pressure. Deposits of this material are located in the sediments on the floor of the ocean, as well as in permafrost on land. From May to

July 2017, China’s Geological Survey, a part of the Ministiy of Land and Resources, conducted a trial extraction of methane hydrate from the Shenhu region of the South China Sea. Authorities in this field believe that methane hydrate will become a strategic focus of global energy development in the future. China’s successful exploration in this arena is leading the way, making the country a front-runner as opposed to a follower. Based on China’s research surveys of methane hydrate and on its existing stock of relevant technology, the expectation is that China will be developing and commercializing this resource by about 2030.

Source: Edited based on relevant media reports.

Box 3.2 Large-scale use of geothermal energy in Xiong County, Hebei Province

As a renewable resource that can be recycled and reused, geothermal energy is green, low-carbon, reliable, and widely available, making it a competitive source of green energy. According to a survey conducted in 2015 by the China Geological Survey under the Ministry of Land and Resources of China, the amount of exploitable geothermal energy in 336 cities in China equates to 700 million tons of standard coal. This considers only shallow- level resources available to these cities, which are at the prefectural level of administration or above. The total hydrothermal-type geothermal resources in the country nationwide translate to 1.25 trillion tons of standard coal, and the quantity that can actually be exploited annually translates to 1.9 billion standard tons of standard coal. Resources at a deeper level, known as ‘hot dry rock’ resources that lie between 3,000 and 10,000 meters underground, equate to 856 trillion tons of standard coal.

In 2015, near-to-surface geothermal energy was already heating floor space totaling 392 million square meters in China. Mid-depth geothermal energy heated another 102 million square meters, for a combined total of 494 million square meters. Statistics show that this substituted for the equivalent of 14.5 million tons of standard coal and therefore reduced CO, emissions by 37.5 million tons. The plan is for China to heat (or cool) floor space totaling 1.6 billion square meters by 2020, when installed capacity will reach 530 megawatts of electric power. By 2020, the supply of geothermal energy should substitute for the equivalent of 70 million tons of standard coal and reduce CO, emissions by 170 million tons.

Xiong County is located in the central plains area of Hebei Province. Located 108 kilometers from Beijing, it had a registered population of nearly 400,000 people in 2016. It is an important part of the Xiong’an Development Zone, which resulted from a 2017 plan to create national-level development zones in certain cities. Xiong Comity is endowed with a wealth of geothermal resources. The people’s government of the county signed a strategic cooperation agreement in August 2009 with the Sinopec Corporation Xinxing Petroleum Co., Ltd. (Xinxing) in order to tap geothermal resources in the comity as a means to ‘conduct conservation-oriented resource development, be ecologically oriented, and promote a green low-carbon economy.’ The project is being implemented by a subsidiaiy of Xinxing, called the Sinopec Green Energy Geothermal Development Co., Ltd. By the end of 2015, nearly RMB 400 million had been invested in the project, leading to 64 geothermal wells, of which 22 wells were rechargeable, that is, allowed for the recirculation of water. The heating capacity of the project was covering 3.85 million square meters. Centralized geothermal energy was supplying heat to basically the entire county seat of Xiong Comity. Cities that use geothermal energy to supply heat can realize ‘zero’ emissions of CO,, SO,, and dust particles. The county is substituting geothermal for 120,000 tons of standard coal equivalent per year, which reduces CO, emissions by 280,000 tons per year. Given its beautiful environment, clean water, and clear air, the county seat of Xiong’an has been rated the number one ‘smog-less city’ in the country when it comes to providing heat in the winter. The geothermal project in Xiong County is the first within what are called the Clean Development Mechanisms projects by the United Nations. On August 30, 2013, the comity was successfully registered into this project in the United Nations. It achieved a Certified Emission Reductions equivalent to 960,000 tons of CO,

In addition to being a model for developing the use of geothermal in the central part of the county seat, the comity is developing a model for use of geothermal in townships and villages that aims for ‘zero carbon’ in demonstration sites, as a pilot project.

Xiong County is also notable for developing a model of development that can be transferred to other places. Not only does it involve government-corporate cooperation, using advanced technology with centrally coordinated development in ways that protect the environment and ensure that the public benefits, but its technology is also reproducible so that the model can be promoted elsewhere. It has become known as the ‘Xiong Comity model’ and has been recognized and supported by the National Energy Administration and Ministry of Land and Resources, as well as local governments and people in the industry. This is highly significant as China seeks to use geothermal as a way to replace the burning of coal for heating purposes. Meanwhile, China is also exploring methods of using geothermal-gas co-generation technology. The country is approaching the issue from the standpoint of improving the economic feasibility of renewable energy sources. This allows ‘green energy’ and ‘low' carbon’ to be realized on a much broader scale.

Source: National Geothermal Energy Center; Sinopec Corporation Xinxing Petroleum Co., Ltd.; and the 13th Five-Year Plan for the Development of Geothermal Energy.

Scientific advances also spin innovations in production methods, which improve the efficiency with which resources are used. The Industrial Revolution realized a transformation of production methods from handwork carried out in workshops to mechanized factories, which brought about a fundamental change in how resources were used. As management methods and production processes improved, the efficiency with which resources were used then began to soar. The Ford automotive style of production emerged, with its large-scale, standardized assembly-line production. Not only were resources used more efficiently, but they were also used on a larger scale. Commonly used, standardized, products were increasingly made via mass production, which lowered their per-unit cost and raised the efficiency of resource use.

In the future, such technologies as flexible manufacturing, computer-aided design and manufacturing, information technologies, 3D printing, and additive manufacturing will continue to advance and become more mature. Smart manufacturing will raise resource efficiency to a whole new level. It is becoming possible to produce individualized, differentiated products in increasingly small numbers, even to the degree that each item is different from every other. Under traditional production technologies, this would have been prohibitive in terms of cost and waste. With the help of the Internet and flexible manufacturing, however, customized ordering is already possible. The situation has already been turned around, from ‘production and then sales’ to ‘sales and then production.’ For example, in the past, clothes, shoes, and hats were made in batches according to several standard sizes. People’s body types are all different, however, and the large inventories in warehouses and the mismatch between product supply and demand have created a huge amount of wasted resources. Such technologies as 3D scanning, 3D printing, and virtual reality prototypes enable individual ordering and individualized production. They can effectively reduce the waste involved in generic mass production.

Scientific advances are also stimulating the use of innovative distribution methods and raising the efficiency with which resources are used. As in the realm of production, the realm of distribution is seeing higher efficiencies, particularly due to economies of scale. The volume of ocean, land, and air transport is increasing and speeding up in order to accommodate large-scale factory-ized production. The size and efficiency of the shipping industry are constantly increasing, leading to a commensurate fall in the per unit cost of shipping a product and thereby greater efficiency in the use of resources. Right now, e-commerce and the Internet of Tilings have brought changes not only to the way goods are produced and sold but also to the way they are distributed. In the traditional field of logistics, frequently a distribution company would have to leave unused space in a given truck or ship or plane, since the load was not fully packed. A different company would need to ship more product than one load would take and so would be searching for additional vehicles. This involved greater resource inputs and massive waste. Using technological innovations, people now can consolidate shipping requirements and make fiill use of the advantages of economies of scale. This is at the core of technological innovation in the field of product distribution. Companies can make use of Internet technologies to set up open, transparent, shared digital application platforms that provide sendees to a variety of customers, including e-commerce companies, logistical companies, warehouse companies, third-party servicing companies, and supply-chain sendee providers. They thereby achieve a rational sharing and allocation of resources. Through shared technology and shared platforms, all parties coordinate demand in the process of distributing goods, which can greatly improve the efficient use of resources.

Scientific advances can also improve people’s lifestyles and increase the efficiency with which they use resources. Ultimately, all natural resources enter people’s lives either as products or as services and then enter into the ‘consumption’ link in the resource-circulation process. Innovations in the production link of the cycle mainly enable production to put out more products and sendees under given factor conditions. Innovations in the consumption link of the cycle mainly enable people to use up fewer products and services, as well as other resources, as they satisfy their need for a given set of functions. Technological innovations in the consumption link of the cycle can be divided into three tiers with respect to how resources are used. First, they can lead to more efficient use of products or resources. That is, a given set of needs can be met with fewer products or resources. Second, they can change the way products and resources are used, and help economies phase out single-use products while promoting recycling and reuse. Third, they can help promote a change in the manner in which products and resources are used, from sole use by individuals toward shared use. This third aspect of technological innovations influences people’s concepts and changes their living habits. It fosters energy conservation and less consumption as circular use and shared resources increasingly become mainstream lifestyles.

Energy conservation and lower consumption are already reflected in people’s habits and daily living. Technological innovations have raised efficient use of resources and are conserving resources and lowering costs in almost every aspect of life. Most things that people eat, drink, wear, live in, and do involve the use of resources, from small things such as light bulbs to larger things such as cars, as well as all kinds of household appliances, home furnishings, and building materials - all these contain the ability to use technologies that improve the efficiency with which the products use resources. The potential is enormous, and resource savings quite apparent. One of the core aspects of improving the efficiency with which resources are used during the consumption link in the cycle has to do with energy efficiency. That is, it has to do with increasing products that are energy conserving and increasing their use and consumption among the population. With advances in technology, more and more energy-conserving products are entering into people’s lives. Their market share is increasing, moreover, as the government puts major force behind promoting them (see Box 3.3). In the future, as smart devices measure energy and resources and as the Internet of Things becomes widespread, this, too, will help improve resource efficiency. By remotely connecting mobile terminals to homes, cars, and office equipment, consumers will be able to adjust the usage of equipment at any time and monitor the amount of their resource and energy consumption. They will be able to optimize their use based on actual need, which will lengthen the sendee life of equipment while reducing unnecessary consumption of energy and resources.

Box 3.3 Projects ‘that benefit the people’ - subsidies for energy-conserving products

Using government subsidies to guide consumers in the direction of using energy-efficient products is an effective way of consening energy and reducing emissions. It also is an important means of increasing domestic demand. The Project to Benefit People through Energy-Efficient Products is a program that uses public-finance subsidies to promote a range of products that meet certain energy-efficient standards. Products include such things as lighting, air conditioners, flat-screen television sets, computers, motors, wind turbines, pumps, and cars.

The Central Ministiy of Finance began this project in 2007, focusing first on supporting energy-efficient lighting products. To encourage the replacement of incandescent light bulbs with energy-efficient lighting products, for bulk purchases, the subsidy is 30% of the winning bid for agreements to provide energy-efficient lighting products. For individual purchases, the subsidy is 50% of the winning bid to provide energy-efficient lighting products. As of 2012, the cumulative subsidies totaled RMB 4.157 billion for the purchase of 655 million energy-efficient lighting products. This directly ‘pulled forth’ domestic demand totaling RMB 8 billion, and it saved 18.5 billion kilowatts’ worth of annual energy consumption.

From June 2009 to May 2011, the government extended the subsidy program to include the purchase of highly efficient fixed-frequency air conditioners, that is, those meeting Level 2 standards or above. The Central Ministry of Finance set standards for subsidies depending on the capacity and energy-efficiency level of the equipment, at a rate that ranged from RMB 150 to RMB 250. During this period, the program subsidized more than 50 million qualified air conditioners, using RMB 14.643 billion worth of public finance. This directly contributed to raising domestic demand for the air conditioners by more than RMB 150 billion and to reducing energy consumption per year by 10 billion kilowatts, since qualified air conditioners can save 80 to 100 billion kilowatts of electricity over their lifetime. The market share of energy-efficient air conditioners increased from 5% to over 70%, and the average price of such air conditioners dropped from RMB 3,000 to RMB 4.000 before the program to about RMB 2,000.

After 2012, the program was expanded to include not just air conditioners but other energy-efficient items, including flat-panel television sets, refrigerators, washing machines, water heaters, stand-alone air-conditioning units, watercoolers, and desktop microcomputers. Starting in June 2010, a program for subsidizing highly efficient motors was approved. From

September 2012, the scope of these subsidies was expanded to include such industrial products as high-efficiency wind turbines, water pumps, compressors, and transformers.

Source: Edited based on information from the website of the Ministry of Finance.

Circular economy

The ‘circular economy’ enters into daily life and the processes of production when onetime use moves to circular use and reuse. Humankind is gradually transitioning from onetime use toward this kind of reuse of resources. Evaluating resources from the perspective of eventually reusing them is a major change in the way humankind uses resources. From the perspective of a circular economy, resources are constantly in the midst of circulation. They go through specific, ongoing loops, constantly changing form and continually being modified. As a result, they are never regarded as waste materials that accumulate forever in the environment. The circular use of resources is the most important conceptual part of putting into effect a circular economy. It includes the three ideas of reducing the use of resources, reusing resources, and recycling resources, all of which make use of technological innovations. The phrase commonly used is ‘3R technologies,’ as ways to improve the efficient use of resources.

Due to the way resource piices are going up and environmental pollution is intensifying, these concepts and the application of 3R technologies are gradually entering into people’s daily lives and are already having a profound influence on product design and use. In the process, 3R technologies are getting better with respect to retrieving and reusing products. On the reducing side, product design is miniaturizing items and making them lighter, while packaging requirements and containers are allowing for repeated use, putting a halt to the pervasive way packaging and containers were being used just once. In addition, the useful life of products is being extended, avoiding the need for quick replacement. On the reusing side, products are increasingly able to be turned into renewable resources once their initial functionality ends, rather than being put into irretrievable garbage. Recycling takes two forms, namely, ‘original form’ recycling and ‘secondary- form’ recycling. Newspapers made into newspapers are an example of the first instance, and pop-top cans are remade into cans. The second form uses waste resources and transforms them into raw materials for other kinds of products.

The sharing economy

The sharing economy is beginning to emerge as the usage of products and sendees goes from individual to shared use. Driven by information technologies that include the Internet, humankind is changing how resources and products are used and, in the process, is ushering in another revolutionary change. The concept of a sharing economy is gaining traction as more and more people are accepting and making use of shared resources, and this will have an immense impact on how products and resources ar e used in the future. Methods by which shared resources are used depend heavily on Internet information technologies. Cooperative sharing is the core concept, which allows the consumer to begin to play the role of ‘producer’ as well. The use of Internet information platforms and related social communication networks allows one person’s products and resources to be enjoyed by others. In addition to enabling better use of idle resources, this allows for a more efficient use of resources and improves levels of social well-being. Models that employ the concept of a shared economy have already penetrated various industries, including taxis (ride-hailing), accommodations, peer to peer lending (P2P) online lending, and crowdfunding. In the long run, the shared resources that are at the core of the shared economy will have a massive influence on industry, methods of employment, models of consumption, and government regulation. They will also profoundly change the patterns by which humankind uses products and resources in the future.

We are coming to a deeper understanding of the role of technological innovation in resource use. At first, the main consideration was how to use technology to improve the efficient use of resources in a onetime use process, that is, how to reduce use of the resource and the resulting polluting emissions. Later, as concepts changed and technologies advanced, resources were no longer seen as disposable items with onetime inputs and onetime consumption. Instead, they began to be seen from a perspective of circular use and reuse, and they were put to use correspondingly. By now, people are not merely thinking of how to use technological advances to conserve energy and use resources in a circular way. They are also thinking of innovative ways to change the models by which resources are used, in order to drive the models in the direction of shared use rather than exclusive use.

Developed and developing countiies apply technological innovation to resource use in different ways. In advanced countries that lead in technology, the focus is on how to expand the boundaries of resource-use technologies, that is, it is on inventing and applying technologies that do not exist at the present time. In developing countries, ‘technological innovation’ is often expressed as copying, learning, and applying other countries’ advanced technology, in addition to modifying technologies so as to adapt to local circumstances. These processes can also improve the efficiency with which resources are used (see Box 3.4).

Box 3.4 The path by which China is ‘catching up with and overtaking’ other countries in the field of large-scale hydroelectric power generation

Hydroelectric power (hydropower) is a renewable resource. China is rich in hydropower resources and developing those resources is a major strategic thrust in the country’s energy plans. A key link in the development of hydroelectric power involves self-generated innovation with respect to large-scale hydroelectric power generating units.

In 1993, prior to starting work on the Three Gorges project, the capacity of the largest generating units in China that the county had independently designed and manufactured was just 320,000 kilowatts. In contrast, generating unit capacities of 700,000 kilowatts were in use in other countries as early as 1978. China’s units were decades behind those of other countries in terms of design and manufacture.

In 1993, upon receiving approval from the State Council’s Three Gorges Project Construction Committee, the capacity of single units at the Three Gorges project was increased from 680,000 kilowatts to 700,000 kilowatts. In 1996, when the Three Gorges project sought bids to design and build the fourteen generating units on the left bank, decision-makers set up a unique form of ‘technology road map.’ On one hand, the project actively carried out international cooperation and imported the most advanced existing technologies and equipment from overseas. On the other hand, it carried out a process of digesting, absorbing, reengineering, and ultimately realizing the domestic production of key technologies. In 1999, based on summing up the relevant variables of the left bank generators, the right bank of the Three Gorges project began research and development (R&D) efforts to optimize its own technology. In 2007, the first unit produced domestically was smoothly put into production. China realized a leapfrogging kind of progress in its design and manufacturing of super-large-scale generators. At the end of 2008, 26 generators on both left and right banks of the Three Gorges project, each capable of 700,000 kilowatts of power, began generating electricity. In monitoring the situation, the overall functionality of generators on the right bank was better than that of the imported generators on the left bank. The domestically produced generators are operating well. In terms of stability and other aspects, they have reached levels comparable with similar units in the rest of the world.

The eight core technologies of the Three Gorges Project indicate that China’s hydropower technologies have leaped forward by some 30 years. They have opened a new era in the design, manufacture, and installation of super-large-scale generators. Those eight core technologies include the hydraulic design of large-capacity generators, the manufacturing and processing technologies for large-scale generating units, and the technologies for cooling large hydroturbines.

By now, China’s total installed capacity of hydropower exceeds 300 million kilowatts, which accounts for 27% of the world’s total installed hydro- power capacity. Five of the world’s ten largest hydropower plants, and more than half of individual units with a capacity of 700,000 kilowatts or more, are located in China. China has formed substantial capacity along the entire industrial chain, from planning and design to construction, equipment manufacturing, and power transmission and transformation. The country has also established long-term partnerships with more than 80 countries with respect to investing in and planning and building hydropower projects. In doing this, China holds more than 50% of the global market for hydro- power. Strongly competitive along the entire industrial chain, and now with extensive international experience, China’s hydropower industry has become a major force in driving global hydropower development.

Source: Edited based on relevant media reports.

Technological innovation drives the ability to use resources sustainably. Innovations involve many spheres of activity and the links that coxmect them, but they can be summarized into six main aspects: first, production: innovations can improve productivity; second, the circular economy: clean production technologies and combined technologies that turn waste into resources can generate renewable resources and ensure that polluting materials are nontoxic; third, product circulation: technologies such as the Internet of Things, as well as other advances and innovations, can raise logistical efficiencies and reduce waste; fourth, use of products: sharing platforms and new models for shared use of products can bring about fundamental change in the ways in which resources are used; fifth, the discovery of new resources: technological breakthroughs and innovations can achieve the substitution of one kind of resource for another; and sixth, ‘induced innovations’ and breakthroughs in the application of technologies can lead to the development of best applications of technologies and the best environments for applying technologies (see Box 3.5).

A new ‘resources revolution’ is being ushered into the world by breakthroughs in information technologies, Internet technologies, nanotechnology, materials technologies, and biotechnologies. In 2011, the consulting company McKinsey published a research report titled The Resource Revolution: Satisfying the World's Needs for Energy, Materials, Food, and Water. This pointed out that the logical starling point for the resource revolution is raising the productivity of resources. Innovations in both technologies and systems will drive forward such things as the mobile Internet, cloud computing, big data, bioengineering, alternative energy sources, and new materials. All these will be integrated into production and consumption in profound ways, which will drive changes in the way resources are developed and utilized and, in turn, raise their productivity and enable sustainability. The resource revolution has been called the Third Industrial Revolution, or alternatively a ‘new round’ of the Industrial Revolution. Such methods as substitution, optimization, virtualization, circularity, and elimination are having an enormous effect on the effective integration of hardware and software. They are enabling the use of new materials in products and new ‘circular’ models of business that are raisitrg the efficiency with which resources are used and bringing about a fundamental change in how resources are used. Exactly how humankind is going to resolve the current scarcity of resources remains a massive challenge. Nevertheless, the resource revolution, as driven by technological change and innovations in business models, are creating a pathway for resolving the problems.

They are providing us with new hope. What is certain is that the resource revolution and related technological innovations will ensure that resources are used with much greater efficiency in the future.

Box 3.5 Ultra-high-voltage transmission

Transmission of ultra-high-voltage electricity refers to the transmission of

1.000 kilowatts or above AC (alternating current) and about 800 kilowatts or above DC (direct current). It represents the most advanced form of transmission currently available in the world. In terms of resource endowment, China’s energy sources and its population and economic development are unevenly distributed around the country - most of the population is concentrated in the east, where the economy is more advanced and living conditions and production conditions are better. This has led to a greater expenditure of energy in the east, despite the fact that energy resources there are not as abundant. China’s coal bed deposits are mainly in the northwest, in places such as Shanxi, Shaanxi, the eastern pair of Inner Mongolia, Ningxia, and parts of Xinjiang. There are few coal bed deposits in the central and eastern provinces of the country. Hydropower resources are mainly located in the western regions and the middle and upper reaches of the Yangtze River, the upper reaches of the Yellow River, and rivers in the southwest including the Yalong, the Jinsha, the Lancang, and the Yarlung Tsangpo. In resolving the problem of how to transmit energy, China can either ship coal or it can ship electricity. The cost of transporting coal is high; plus, it involves tremendous environmental pollution. China’s only real choice is to transmit electricity long distance, which is defined as more than 1,000 kilometers. This choice is dictated by the country’s realities.

The transmission of electricity requires taking into consideration the loss and waste of energy in the process. For long-distance, large-scale electric power networks, ultra-high-voltage transmission is technically and economically most advantageous due to its capacity, long-distance potential, low loss of energy, and small footprint. The electric-power transmission capacity of 1,000-kilowatt ultra-high-voltage transmission lines is five times that of 500-kilowatt extra-high-voltage transmission lines. Generally speaking, the latter are economically feasible for distances of about 600 to 800 kilometers. The former are economically feasible for distances of

1.000 to 1,500 kilometers or even more, due to higher voltage and less loss of power along the way.

There is no precedent for this kind of ultra-high-voltage transmission elsewhere in the world. Developed countries basically do not have the demand for it, while developing countries do not have the technology or ability to fond it. In 2004-2005, relevant departments in China began looking into the feasibility of ultra-high-voltage transmission, and heated debates ensued. In

August 2006, the government evaluated and then approved an experimental pilot project running from southeast Shanxi to Nanyang to Jingmen. This 1,000-kilowatt project was put into operation in January of2009. As of June 2016, the State Grid Corporation of China had completed seven such ultra- high-voltage transmission projects, including three AC and four DC projects. It had under construction another four AC projects and another six DC projects. Altogether, these seventeen projects contained 29,000 kilometers of transmission lines and had transformer capacity (alternating current) of more than 300 million kilowatts. They had transmitted a cumulative total of more than 500 billion kilovolt-amperes (kilowatts) of electric power.

In February 2014 and July 2015, the State Grid Company of China won the bids for Phase I and Phase II of Brazil’s Belo Monte ultra-high-voltage DC transmission project. This put China’s goal of ‘striding out into the world’ in this arena into actual effect, with its fiill set of ultra-high-voltage technologies, equipment, contracted engineering, production, and operating sendees.

In 2012, a ‘special categoiy award’ in China’s annual awards for ‘Scientific and Technical Advances’ was given to a project in this field, titled Key Technologies, Equipment, and Applications in the Field of Ultra High Voltage Alternating-Current Transmission.

Source: Edited based on materials from the State Grid Company of China and related media reports.

If we are to achieve sustainable use of resources, the only choice is to use technological innovations to bring about the resource revolution. This involves revolutions in both the supply of and the demand for resources. The core substance of both of these is a revolution in resource technologies. In order to safeguard both, we must also achieve a revolution in the institutional systems that apply to resources. International cooperation on resources and global governance of resources also influence the results. With specific respect to China, four primary aspects can be said to impact the use of technological innovations to realize the resource revolution.

The first of these relates to consumption and speeding up the application of technological innovations in the sphere of resource consumption. This includes improving resource productivity, holding down irrational use of resources, promoting a shift to a new style of resource consumption, and bringing into effect a consumption model that conserves resources. The second relates to the production and speeding up the application of technological innovations in the sphere of production. This involves promoting the development of new resources, including new applications and substitutions, effectively strengthening the basic infrastructure that affects resource supply, and setting up supply systems that allow for the supply of diversified resources. The third relates to pushing for market-oriented reform in the piicing of resources. This involves using technological innovations to lower the cost of supplying new types of resources, improving the economic feasibility of new resources and new materials, driving innovations in industrial and business models, creating market-oriented price-formation mechanisms, and stimulating effective competition. The fourth relates to expanding international cooperation with respect to technologies. This involves strengthening interaction and coordination in the area, ensuring that international and domestic projects relating to resources are aligned with one another, improving the quality of resource development, and improving the international competitiveness of China’s resource industries.

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