Vigorously develop the wind power industry

1 Introduction
With the rapid economic development of the 21st century, coupled with the depletion of natural resources, environmental damage, and the continuous growth in energy demand, the development and utilization of new energy sources have become increasingly urgent. The development of wind, solar, and tidal energy can effectively alleviate my country's energy supply predicament, among which wind power generation has the most mature industrialization conditions.
Grid-connected power generation of large and medium-sized wind turbines has become the main form of wind energy utilization worldwide. With the continuous growth in demand for grid-connected turbines, increased production, turbine upgrades, improved unit capacity, optimized performance, reduced failure rates, and lower production costs, wind power has become competitive with conventional energy sources. Furthermore, the increasing energy demand and the increasingly stringent enforcement of environmental regulations mean that wind power technology, as a continuously developing and improving multidisciplinary high-tech field, will increasingly demonstrate its advantages and economic benefits through technological innovation, increased unit capacity, improved structural design and manufacturing processes, and reduced component weight and costs.
my country possesses abundant wind energy resources, with a theoretical potential of 3.226 billion kW and a preliminary estimate of 253 million kW of exploitable installed capacity, ranking first in the world. This is comparable to the exploitable hydropower capacity of 378 million kW, indicating significant potential for commercial and large-scale development. Since the mid-1990s, my country's wind power generation has begun to develop towards commercialization. 2. Main Factors Affecting Wind Power Development

2.1 Wind Energy Resources
Understanding local wind energy resources is crucial for estimating wind farm power generation and assessing potential benefits. For wind farms, the minimum annual utilization time for wind turbine generators is 2000 hours; that is, a single 600kW wind turbine generator must generate at least 1200 MW/hour annually to be considered worthwhile for development. A wind farm with an average annual utilization time of 2500 hours has good development value; and a wind farm with an average annual utilization time exceeding 3000 hours is considered excellent.
Currently, the annual utilization hours of wind farms in my country are generally 2,700 hours, and in some places they reach 3,200 hours. The cost of wind power is 0.45-4.70 yuan/kW-h, which is already quite competitive compared to the price of thermal power in developed provinces and cities.
2.2 Power Grid Conditions
When wind power capacity does not exceed 10% of the local power grid's total capacity, wind power will not affect grid quality. However, due to the randomness of wind, wind power cannot be dispatched, and therefore it cannot replace conventional installed capacity to meet load requirements. The electricity generated by wind power can replace the electricity generated by coal-fired power plants, reducing pollutant emissions. Generally, wind farms with abundant wind energy are located far from the existing power grid; therefore, the cost of grid connection should be considered during planning, ensuring coordination with grid development.
The "Regulations on the Management of Grid-Connected Operation of Wind Power Plants (Trial Implementation)," issued in July 1994, stipulates that "when the capacity of a wind farm accounts for less than 5% of the unified dispatch capacity of the power grid, control equipment is generally not required; when it exceeds 5%, it should be determined in consultation with the power grid dispatching agency." Except for the Urumqi power grid, where the installed capacity of wind power connected to the grid is 63,600 kW, accounting for approximately 3.3% of the grid's installed capacity, other regions are far from this threshold and will not be an obstacle to the development of wind power.
2.3 Economic Aspects
With technological advancements, wind power costs are gradually decreasing. However, currently, the on-grid price of wind power in my country is 0.3-0.4 yuan/kWh higher than that of coal-fired power. Methods to reduce wind power costs include site selection, large-scale development, optimized wind farm design, and selecting turbine models through equipment bidding. For example, when the average annual utilization hours of wind turbine units in a wind farm reach or exceed 2500 hours, the cost per kWh will drop below the cost of thermal power in some developed regions such as East China and South China. Another crucial method is to reduce the cost of wind turbine units, as they account for a very large proportion of the initial investment in a wind farm, approximately 70%. Utilizing domestically manufactured components as much as possible, while achieving the same quality as imported equipment, will significantly reduce the price gap between wind power and conventional coal-fired power.
Between 1997 and 1998, my country put 209 wind turbines into operation, with a total capacity of 114,200 kW. All of these were imported, resulting in high equipment prices. The cost per kilowatt for a wind farm was approximately 8,000 to 9,000 yuan, with the turbines accounting for 75% to 80% of the investment. Only by gradually achieving domestic production can the cost of wind farms be reduced. Currently, the cost per kilowatt for large and medium-sized hydropower stations in China is 7,000 to 8,000 yuan, and the cost per kilowatt for thermal power plants, including desulfurization and environmental protection facilities, exceeds 7,000 yuan.
2.4 Policy Aspects
Initial policies incentivizing wind power development were administrative, such as allowing grid connection, purchasing all electricity generated, interest-bearing pricing, and grid amortization. These policies enabled owners to secure bank loans for wind farm construction, and the price difference between wind power and conventional thermal power was even borne by the profits of the power bureau system. Provincial governments that prioritized wind power allowed the price difference to be factored into the province's average electricity sales price. Currently, there is an urgent need to formulate policies that allocate costs based on pollution emissions, with all provinces sharing the burden. Simultaneously, each province should set a maximum on-grid tariff for wind power based on local wind energy resources to facilitate effective wind energy development and reduce costs.
The main cost of wind power generation is fixed asset investment, accounting for over 85% of the total investment. According to my country's value-added tax (VAT) deduction policy, VAT on fixed asset investments is not deductible. Wind power generation is subject to a 17% VAT rate. Because there are no deductions for fuel purchases, the actual tax burden of wind power generation is significantly higher than that of thermal power generation. In response to these issues, the State Economic and Trade Commission, based on in-depth research, proposed a VAT reduction or exemption policy for wind power generation to encourage the further development of the wind power industry. With the approval of the State Council, the Ministry of Finance and the State Administration of Taxation jointly issued a document clarifying that wind power generation would be subject to a 50% reduction in VAT payable.
According to the new tax policy, the average price of wind power will decrease by about 50-60 yuan, and the price of electricity from newly built wind farms is expected to drop to over 0.50 yuan per kilowatt-hour.

3. Wind power industry in Gansu Province
3.1 Favorable conditions for developing the wind power industry in Gansu Province
In terms of distribution, the areas with relatively abundant wind energy resources in China are mainly located in the southeast coast and nearby islands, Xinjiang, Inner Mongolia, the Hexi Corridor in Gansu, and parts of Northeast China. The annual wind speed is above 3 m/s for about 4,000 hours, and the annual average wind speed in some areas can reach above 7 m/s. These areas have great development and utilization value and are the main wind power development bases in my country in the future.
Gansu Province is located in the northwest region of my country, an area rich in wind energy resources. According to statistics from the National Meteorological Department, its total wind energy reserves rank 5th in the country, accounting for 77% of the national total. The total exploitable wind energy reserves are estimated at 19.5 to 20 million kW, mainly concentrated in the Jiuquan area of ​​the Hexi Corridor, with other areas distributed in some mountain passes such as Wushaoling, Huajialing, and Jiling. The Hexi Corridor experiences relatively small interannual and intra-annual variations in wind speed, with an annual average wind speed variation coefficient between 0.02 and 0.025, which is extremely favorable for wind energy utilization. Gansu Province possesses abundant wind energy resources, a vast exploitable area, a superior geographical environment, excellent power grid transmission conditions, convenient transportation, and a relatively strong existing electromechanical manufacturing base. These favorable conditions lay a solid foundation for Gansu Province to accelerate the industrialization of wind power. Currently, only the Yumen Wind Farm has been developed, built, and put into operation as a large-scale wind farm, indicating significant room for further development.
In 2004, the National Development and Reform Commission (NDRC) mandated a 70% localization rate in the concession bidding for three large-scale wind farms. This policy aimed to attract multinational corporations to set up factories and transfer technology in China, helping to narrow the gap between my country and international standards in design, construction, and management. Through policy-driven initiatives, my country focused on cultivating its own wind power manufacturing industry. Simultaneously, market competition and increased localization rates prepared the ground for lower wind power costs.

3.2 Unfavorable Factors for Developing the Wind Power Industry in Gansu Province
With technological advancements, the cost of wind power has decreased significantly. However, the current grid-connected price of wind power in China remains uncompetitive compared to coal-fired power. For a wind farm with an installed capacity of 100MW and an annual power generation of 250GW-H, local grid consumers need to pay an additional 75-100 million yuan annually to purchase wind power. While this is a price to pay for environmental protection, excessive and rapid development of wind power in Gansu Province, with its slow economic development and limited ability to afford electricity prices, will also place a heavy burden on the region.
3.3 Gansu Province's Strategy for Developing the Wind Power Industry
Our province possesses favorable natural conditions for developing the wind power industry. However, due to its long-standing economic lag behind the eastern regions, electricity prices are significantly lower than in economically developed areas. Under these circumstances, wind power development first requires policy support. Although the localization rate of 200-300 kW wind turbine units developed domestically has exceeded 90%, and the localization rate of 600 kW prototype units has reached 80%, megawatt-class wind turbine units have not yet achieved localization. Currently, the state has introduced tax incentives to encourage wind power generation, significantly reducing the investment cost of wind turbine units. Even so, the grid connection price of wind power is still much higher than that of hydropower or thermal power in our province. Therefore, legislation on renewable energy is needed to break down regional segmentation in the electricity market, solve the key problem of amortizing wind power costs nationwide, and supplement this with incentive policies in credit, taxation, and consumption to guide more investment into the wind power industry.