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China's $60B wind power empire needs to grow its own blades

In the tropical climate of China's Yunnan province, scientists are planting a key ingredient to help strengthen the country's position as the world leader in wind power: balsa trees. 

Balsa, best known as a craft material for making model airplanes, is a major component of giant blades for wind turbines. China's $60 billion wind industry sources almost all its materials domestically, but it's had to reach abroad for the lightweight wood.

As the country that builds the most turbines in the world rushes to install wind power at a blistering pace to reach ambitious climate targets, suppliers are struggling to find enough balsa. To relieve the shortage and reduce imports, China is now looking to grow its own.

"Given the carbon peaking and neutrality targets, clean energy became a very important issue," said Zou Shouqing, a retired professor at Xishuangbanna Tropical Botanical Garden of Chinese Academy of Sciences. "So the country needs balsa wood."

Zou, who has been researching balsa in China since the 1960s, led a team planting the tropical trees in Xishuangbanna, an autonomous prefecture in Yunnan, and is now consulting for the first balsa plantation on a commercial scale in the country.

Xishuangbanna, which borders Laos and Myanmar and is dominated by the minority Dai population, planted about 4 square kilometers of balsa in 2020 and 2021. More is planned, potentially meeting about 10% of national demand, Zou said.

While the booming wind industry has led many farmers to switch from rubber trees to balsa, the domestic business is in the early stages. It takes at least four years before a tree is ready to harvest, so China's first batch of commercial-scale balsa wood won't be ready for harvest until 2024.

Planting "needs to continue to develop, or it still won't be enough," Zou said.

The domestic effort won't entirely replace China's imports, which amount to about 1 million cubic meters of balsa a year -- enough to fill the Empire State Building. But it will provide some relief. The surging demand from China as well as the U.S. caused the price of balsa wood to nearly triple over a 15-month period through mid-2020, according to consultancy Wood Mackenzie.

The need for the wood in the wind turbine industry is huge. Stiff and lightweight, it makes up the bulk of a blade's core, sandwiched between two layers of fiberglass to add strength. A 100-meter-long turbine blade could require 1,229 kilograms of balsa, according to a U.S. Energy Department report.

But China hasn't previously been an ideal location for growing balsa. Zou and his team tried but failed to cultivate balsa on a large scale on the tropical island of Hainan, and in the southern Guangdong and Guangxi regions. He finally settled on Xishuangbanna as the country's most suitable place.

Domestic-grown balsa still needs to prove itself on price competitiveness and quality. The higher land and labor cost in China could boost production expenses, and transporting tons of wood from the mountainous areas in Yunnan to a factory on the east coast may not end up being much cheaper than shipping costs from South America.

Xishuangbanna has lower temperatures and precipitation compared with major suppliers like Ecuador and Papua New Guinea. That means Chinese balsa grows slower, which could lead to higher density wood, though it still meets the quality standards for blade manufacturing.

Balsa also faces competition from a cheaper alternative, polyethylene terephthalate, or PET. The light, strong plastic material made its way into more major wind companies' turbine designs during the 2019 and 2020 balsa shortage. PET is set to exceed balsa to become the main core material used in blades, taking about 60% of the global share in 2025, according to Wood Mackenzie.

Yet balsa will keep a significant portion, as its reliability has been tested over the past 20 years, said Shashi Barla, a consultant at Wood Mackenzie. Companies are less likely to use a new material like PET especially when it comes to the offshore market, where repair costs are more expensive than onshore.

And while PET is currently cheaper, the major manufacturers are all western companies, and it will likely face higher production costs in the next few years. Meanwhile, China's design capability has yet to reach the level where it can replace balsa with PET, said Shane Sun, general manager of RESolution Consulting.

"Balsa always has an inherent advantage," said Barla. "There will be a stable demand."

 

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