The move is aimed at boosting rural economies, providing basic amenities to residents and slashing pollution from burning wood or fossil fuels.

Most of the stations are located in western hinterlands which have been cut off from mains supplies so far.

Up to 30 percent of the total funds allocated to the project is expected to come from the State with the rest being raised by local authorities set to benefit from the electrification program, water chiefs announced Wednesday.

The program -- approved by the State Council -- is a ``strategic measure to solve the regions' underdeveloped economy and worsening ecosystems caused by chronic poverty,'' Wang Shucheng, minister of water resources said Wednesday in Beijing at a national conference.

It is hoped the program will benefit nearly 200 million rural residents with 85 percent of them living in western regions, said Zhang Youcai, vice-minister of finance.

Since the 1980s, China has turned to small hydropower stations with installed capacity of up to 50,000 kilowatts to deliver electricity to millions of rural households.

The ambitious rural electrification (RE) strategy succeeded in giving 653 counties key power supplies by the end of 2000 with hydropower delivered to most rural households, said Chen Lei, vice-minister of water resources.

China is expected to upgrade 400 of them as medium-stage RE counties by 2005, Chen confirmed.

The electricity will enable households to use lighting and basic appliances while also boosting the rural economy through the development of township enterprises and by-product processing.

Annually, 5.6 million hectares of forests were burned by about 112 million rural people for heating and cooking for the lack of electricity, according to statistics released by the ministry. This not only destroyed local ecosystems but also seriously polluted the environment.

China's total exploitable hydropower potential is estimated to be about 87 million kilowatts, ranking it the largest in the world.

Small hydropower stations produce about 80 billion kilowatt-hours annually, supplying electricity for one-third of the country's counties and one-fourth of its total population. It is the equivalent in power of consuming 30 million tons of standard coal.

This means at least 300 million rural people have access to power so far.

Only 29 percent of China's hydropower resources have been exploited, far less than in some developed countries. On the other hand, around 75 million rural people have still no access to power.

(China Daily November 22, 2001)