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China's Electricity Demand to Rise
Demand for electricity is expected to rise by 9 to 10 percent this year with power shortages emerging in China's economically booming southern and eastern areas, an industry association said.

Periodic blackouts are set to continue in the coming months in south China's Guangdong Province, east China's Anhui, Jiangsu and Zhejiang provinces and Shanghai, southwest China's Sichuan Province and Chongqing Municipality and Northwest China's Gansu, Qinghai and Shaanxi provinces and the Ninxia Hui Autonomous Region, and north China's Hebei and Shanxi provinces, according to a report from the China Power Enterprise Association.

The strained power supply in these areas since the end of the last year is mainly due to insufficient construction of power generators in past years, it said.

Robust industrial production, falling water supplies for hydroelectric generators and disruptions of coal supplies will also take their toll, it said.

The report said electricity demand in China is expected to exceed 1.8 trillion kilowatt-hours this year, 149 billion kilowatt-hours more than last year.

"Healthy economic development will boost electricity demand," the report said.

In the first two months of this year, electricity consumption jumped by a historic high of 17.6 percent to 264.8 billion kilowatt-hours as high power-consuming industries -- including metallurgy, transport and textiles -- continued their strong performance.

Almost half of the country's provinces and regions have experienced blackouts since the beginning of the year, according to the State Power Regulatory Commission, the industry watchdog.

Local power companies have to cut off power to residential users at peak hours to guarantee a sufficient supply for industrial production.

Association officials said electricity growth is set to slow down in the next few months and peak this summer when people start to use air-conditioners.

The officials said electricity supply in the named areas will inevitably fall short this summer and in the next two or three years.

A supply gap of 10 million kilowatts of generating capacity is expected this summer, the association's report said.

Officials from the commission, however, stressed that the situation could be handled by reinforcing electricity distribution between power-rich and power-hungry areas.

"There is still room for maneuver," said Shi Yubo, the commission's vice-chairman.

The commission will discourage users from using so much electricity at peak times by increasing the cost during the busiest hours and cutting the overnight price, Shi said.

However, analysts said that, despite the electricity oversupply in areas such as northeast China, electricity transmission between different regional grids will be limited because the trans-regional grid is too fragile to cope with the distribution of large amounts of electricity.

In 2001, the cross-regional electricity transmission only accounted for 1.6 percent of the Chinese mainland's total electricity distribution.

The power-shortage problem fundamentally lies on the supply side. The report said the growth in demand has been underestimated in previous years, resulting in the construction of new generators falling behind demand since 2000.

Last year, the generating capacity increased by 4.3 percent, 7.2 percentage points lower than the growth in demand, according to the association's report.

It is estimated that China will be short of 15 million kilowatts of generating capacity in 2004.

Coal companies have also increased coal prices, forcing some generators to stop operating.

(China Daily April 16, 2003)

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