Powering large-scale infrastructure projects in countries along the Belt and Road may seem like a challenge, but nations are getting a much-needed boost in the form of massive investment and financing for a wide range of generation projects.
"There is huge demand for new and improved energy and logistics infrastructure in developing countries along the BRI," says Dr. Kaho Yu, senior Asia analyst at Verisk Maplecroft and associate at Harvard Kennedy School. In the past the “infrastructure has received little investment in many places”.
Power generation is a crucial building block for the BRI, particularly where electricity shortages and frequent outages cripple economic development, diminish quality of life, and prohibit broader infrastructure projects.
The International Energy Agency estimates 860 million people globally lack access to electricity1, with hundreds of millions more living with unreliable power that makes even everyday tasks such as schooling and cooking frustratingly difficult. To overcome this, nations along the Belt and Road are deploying a range of generation methods.
One such method is distributed power generation (DPG). DPG stations can be built rapidly and a range of locations and offer mobility. One of the largest DPG companies, VPower, has already deployed 10 gas-fired projects along BRI routes2 with a capacity totaling 273MW.
Alongside DPGs, a range of other generation methods are starting to come online. Indonesian leaders in July celebrated the opening of their first wind farm3. In Egypt, a Chinese company is assembling the world’s largest solar park4, which will generate 1,600MW when completed by the end of 2019. At the BRI’s farthest frontier, in Argentina, work is underway on a 1,310MW hydropower project5 financed by China that could boost that country’s power capacity by 5%.
This mix of power generation is vital to the success of the BRI. “For developing countries, the cost of using renewables for power generation is still high, so it’s not a cost-effective way to generate power at the moment,” explains Yu. “Yet renewables, especially solar power, are a good solution for remote regions that aren’t connected to existing grids.”
As Beijing forges ahead with the BRI and sustainability comes to the fore, its clear projects will have to find a balance between clean and cheap. If the right balance is found, these projects could well power a new wave of prosperity as well as innovative, greener generation methods in the future.
There is huge demand for new and improved energy and logistics infrastructure in developing countries along the BRI," says Dr. Kaho Yu, senior Asia analyst at Verisk Maplecroft and associate at Harvard Kennedy School. In the past the “infrastructure has received little investment in many places