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Experts: Power Crunch Not Easy to Solve

Facing a severe power crunch, senior experts and advisors hailed the government's move to rein runaway investment in sectors that use too much electricity and boost the power supply.

While it is unlikely the move will produce tangible results in the near future, the government has taken specific steps to curb over investment in sectors that require heavy energy usage.

Highlighted in discussions of the ongoing session of the National People's Congress (NPC), the move was billed as a very important step forward, in line with the nation's shifting emphasis on more "scientific" development.

Putting the brakes on over-investment in highly power-hungry sectors like aluminium will not only help ease the power crunch but also protect the environment, experts said.

Liang Youzi, an NPC deputy and also vice-director of Hunan Jinzhushan Power Plant told China Daily, the rising price of raw materials has put a serious dent on an already meager power supply.

"Our province has had to switch off supply from time to time to prevent the grid from collapsing," she said.

Promoting energy-saving measures, according to experts, is also very important to help overcome future hard times as it will still take years to ease the energy squeeze in China.

K. F. Yan, a Beijing-based senior analyst with the Cambridge Energy Research Associates, said readjusting the power consumption structure is key to alleviate the shortage.

China lags far behind Western countries in efficient power use.

An example is that consumption of a kilowatt/hour of electricity in the United States can produce a profit of US$8 on average, but the figure in China is less than 8 yuan (US$0.96).

"Power-saving standards should be mapped out to maintain sustainable economic development," Liang said.

Presently, for example, China's heating systems are very inefficient leading to high energy losses, according to Jorgen Clausen, chief executive officer with Danfoss, a leading Danish industrial company.

"Heating reform in China is immediately meaningful and applicable," he said.

Xie Songlin, a member of the 10th National Committee of the Chinese People's Political Consultative Conference (CPPCC), told China Daily: "Power supply shortages cannot be solved quickly, given the current conditions."

Memories of blackouts are still fresh for much of the country's population.

More than two-thirds of the nation's territory suffered from power shortages during the past year, mainly a result of insufficient electricity transmission capacity.

The blackouts last summer were partly attributed to bad weather. Unexpected drought greatly crippled generating capacity in some regions.

But the weather should not take all the blame.

According to Xie, also senior adviser to the State Grid Corp, China's power consumption this year is forecast at 2.09 trillion kilowatt hours, an increase of more than 10 percent year-on-year, but the power supply can only grow about 10 percent.

In 2004, except in Shandong and provinces in Northeast China, there is a possibility for more power cuts.

This is especially true for the wealthy regions in East China, which face a very severe situation, Xie said.

The urgency to boost energy output has been accentuated by State leaders recently.

However, some say that a solution to the chronic power shortage will have to be worked out quickly to make sure the supply catches up to the world's fastest-growing economy.

China will begin construction on 40 million kilowatts of generating capacity and add another 37 million kilowatts in additional capacity in 2004 to alleviate a power crunch, Ma Kai, director of National Development and Reform Commission, told the NPC on Saturday.

The country aims to speed up construction of a strategic oil reserve and kick off operation of a mammoth east-west natural gas pipeline into full commercial production.

China also plans to construct a giant hydropower project, which would rival the Three Gorges Project when completed, in Jinshajiang River, the upper reach of the Yangtze River.

The State Grid Corp is also quickening steps to construct power generators and transmission grids. It plans to boost transmission from the Three Gorges power station to Guangdong and Shanghai. It is also working to enhance the integration between the power grids.

But all these efforts can only pay off gradually.

Xie said coal shortages and poor ability to transport coal create bottlenecks in the country's power supply.

According to him, China will have consumed 250 billion tons of coal by 2010 and 320 billion tons by 2010. But China's reserves total only 198 billion tons.

"Solving the energy crunch is a systematic project. The government needs to work out a long-term strategy," he added.

(China Daily March 9, 2004)

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