Facing an increasing power shortage, the city is seeing an urgent need to optimize its coal-based energy structure and is encouraging the development and use of clean energy.

On Tuesday, six local big companies and leading universities established a consortium for clean energy. Among them were Shanghai Huayi Group, Shanghai Electric Power Co Ltd, Shanghai Jiaotong University and Tongji University.

In addition, the Italian Ministry of the Environment and Territory and the Shanghai Technology and Science Commission came to a memorandum of understanding and built a hydrogen research centre. Under that MoU, the two sides have initiated energy studies in the area of innovative coal and biomass-based electricity, hydrogen production and fuel cells.

"Italy has the expertise in clean energy, especially in efficiency and hydrogen. We are glad to work with Shanghai," said Corrado Clini, director-general of the ministry.

Clini revealed that a building demonstrating the use of clean energy would be a showcase in the World Expo Park in Shanghai by 2010 where visitors may see vehicles using fuel cells, a hydrogen-power centre to provide clean energy for air-conditioning systems, warm water and other functional uses.

"Energy security and clean energy are very critical for the city's continued development. Shanghai needs to combine the clean energy technological innovation efforts of universities and enterprises to upgrade the energy structure and reduce pollution," Jiang Ping, deputy secretary-general of the Shanghai municipal government, said at the weekend ceremony.

As the economy continues its rapid growth, a shortage of power has become more and more serious in recent years. In the summer of 2004, the city faced a power shortage of up to 4 million kilowatts.

At present, about 62 percent of the total energy consumption in Shanghai is derived from coal, and about 91 percent of power generating capacity is based on coal-fired power plants.

"These shortcomings are obvious: Coal has not been efficiently used through direct gasification, and its firing produces considerable pollution," said Professor Luo Yonghao, deputy director of the Institute for Thermal Engineering at Shanghai Jiaotong University.

The government and clean energy experts are taking the problem seriously, and the city has explored wind power, solar energy and other clean forms to resolve the energy shortage.

Four wind-power plants, for example, in the coastal area of Fengxian generated 7.5 million kilowatts electricity last year.

The city's first natural-gas-fueled power plant is under construction at the Shanghai Chemical Industry Park in Caojing, with a generating capacity of 600,000 kilowatts. Two generators at the plant will be capable of producing 300,000 kilowatts each.

(China Daily May 19, 2005)