China’s top utility breaks ground on Jiuquan wind farm

Beijing-based electric utility China Huaneng Group said today it has started constructing the first phase of a large wind farm in Jiuquan city, in China’s northwest Gansu Province.

The first 500 megawatts is expected to come online in the first half of 2010, with an additional 1 gigawatt to be added in the second phase at an unspecified time.

When fully operational, the wind farm is anticipated to be able to reduce greenhouse gas emissions by 3.37 million tons a year, according to China Huaneng Group, which is also a state-authorized investment entity. Financial details about the project were not disclosed.

Through its subsidiaries, China Huaneng Group develops and operates more than 85 thermal and hydropower plants. It has a 51 percent stake in its subsidiary Beijing-based Huaneng Power International (NYSE:HNP).

In May, Huaneng Power International received the green light from regulators for its second wind power project, also located in Gansu Province (see Huaneng Power’s wind farm gets OK from regulators). The RMB 2.037 billion ($298.5 million) project is expected to have the capacity to generate 199.5 MW.

It’s unclear whether this project is related to China Huaneng Group’s project announced today.

Huaneng Power owns 17 power plants, has controlling interest in 13 power companies and a minority stake in five power companies in China. It also owns one power company in Singapore.

According to the Jiuquan Reform and Development Bureau, Jiuquan city is on track to become China’s first major wind power production base, with an installed wind power capacity of 5.2 GW by the end of next year, 12.7 GW by 2015 and 20 GW come 2020.

The State Grid Corp. of China is planning to establish a 750-kilovolt grid network in northwest China to make use of the wind power that would be generated from the Jiuquan site. The grid is expected to be in operation by the end of next year.

Earlier this month, Duke Energy said it entered into a memorandum of understanding with China Huaneng Group to explore renewable and other clean technologies (see Duke Energy, China’s top utility ink deal to hunt for cleantech investments).