Enel is aiming to take advantage of growth opportunities in China’s smart grid and renewable energy sectors through a new agreement with State Grid Corporation.

The two firms have signed a memorandum of understanding aimed at boosting co-cooperation in technologies that can enable sustainable urban development as well as exchanging experiences in the implementation of renewable energy generation.

Enel CEO Fulvio Conti has also met with China Huaneng Group to expand the scope of an existing co-operation agreement.

Conti said that the agreement with State Grid, China’s dominant distribution and transmission utility, recognised "the significant strides being made by State Grid in the fields of smart grids and renewable energy".

According to Enel, a new co-operation agreement with China Huaneng Group will be finalized and signed in the first half of 2014 and will encompass cooperation in the field of joint technology development, carbon strategy, power sector investment and academic exchanges through research foundations.

According to the 2013 World Energy Outlook published by the International Energy Agency, electricity demand in China will account for 31 per cent of global demand by 2035 with emissions expected to reach a level double that of the United States, if no new actions are taken.

To mitigate this trend and to transition to a low carbon economy, the Chinese government has introduced new industrial policies to support and develop clean energy industries in nuclear, solar, wind and biomass energy technologies, as well as promote hybrid and electric vehicles, energy efficiency and environmental protection technologies. Other policies aim at supporting new technology research and innovation.

Together with rising energy consumption and growing awareness of environmental issues, urbanisation is another relevant trend that is emerging in China. By 2020, 60 per cent of its 1.3 billion people will be living in cities. To absorb this migration, China will need to invest in innovative, sustainable transport networks and urban infrastructures in order to ensure that this growth meets environmental targets. Urban planning has been set as a policy priority of the Chinese government.