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China will be able to substitute bio-liquid fuel for 10 million tons of refined oil products in 2020, said a Chinese energy think tank on Tuesday.

Han Wenke, deputy director of the Energy Research Institute of the National Development and Reform Commission (NDRC), said at the ongoing forum on decentralized sustainable energy solutions in China, that by 2020 renewable energy will increase China's energy supply capacity by 400 to 500 million tons of coal equivalent.

Then renewable energy will account for 10 percent of China's annual energy consumption, he said.

China's electricity installed capacity by renewable energy will be over 360 million kilowatts, including 300 million kilowatts by hydro, 30 million kilowatts by wind farm, 150,000 kilowatts by small wind, 30 million kilowatts by biomass and 1.8 million kilowatts by solar.

By 2020, China's production capacity of bio-liquid fuel such as fuel ethanol and bio-diesel will reach 12 million tons, which could substitute some 10 million tons of refined oil products, said Han.

Soaring international oil prices have encouraged investment in alternative energies. According to statistics of the Worldwatch Institute, world output of ethanol and bio-diesel is over 30 billion liters in 2004, accounting for three percent of the total gasoline consumption that year.

Han said that China's current fuel ethanol production capacity, with corn as raw material, is 1.02 million tons per year, and the trial production scale of fuel ethanol with sweet sorghum as raw material is 5,000 tons per year. The annual production capacity of bio-diesel is 20,000 tons.

China has been mixing a percentage of ethanol into gasoline in some provinces including northeastern Heilongjiang, Jilin and Liaoning provinces, and central China's Henan and Anhui provinces.

The experiments in these areas are going well and the NDRC is planning to expand it to more regions, said Zhang Guobao, vice-chairman of the NDRC, at the Boao Forum for Asia Annual Conference 2006 held last month.

(Xinhua News Agency May 17, 2006)