The nation's most severe power shortage since the 1980s has left
Xia Bing almost sleepless in recent days, beset by worries over the
rising costs and declining output at his construction materials
plant in Guangzhou, south China's Guangdong
Province.
"Because of the restricted power supply, workers have three days
off a week," he said.
"I have lost quite a few orders, and even so, I have to
compensate the workers for their lowered incomes."
Most of China's factory owners in the nation's power-hungry
regions are suffering from the same problem during this hot summer,
including foreign investors.
This summer is expected to see the nation's most severe power
shortage since the 1980s, with the government taking various
measures to guarantee power supplies.
The total power shortfall will reach 30 million kilowatts this
summer, Zhao Xizheng, general manager of the State Grid Corp, said
last month.
And experts estimate that 17 million kilowatts of this shortfall
will occur in east China, particularly in Zhejiang
and Jiangsu
provinces and Shanghai.
Power shortages, first felt last summer, grew to more than 20
million kilowatts last winter, covering two-thirds of the
nation.
Statistics released by the State Electricity Regulatory
Commission (SERC) indicate more than two-thirds of the nation's
provinces, mainly in eastern and southern China, are suffering from
power shortage, with east China's Zhejiang Province almost trapped
in an "electricity crisis."
North China, including Beijing, has also recently been added to
the list. The capital city will have a power shortage of 1.2
million kilowatts this summer.
So far, the National Development and Reform Commission (NDRC),
China's top planner, has increased the electricity price in the
four regional power grids - south China, east China, central China
and north China, by an average of 2.2 fen (0.27 US cents) per
kilowatt hour to ease the shortage.
The NDRC is also likely to take similar moves in the northeast
China and northwest China grids.
Meanwhile, the NDRC has further widened the gap between
electricity prices during the peak hours and those during the
downturn, which has been implemented among more industrial
users.
China began to adopt different electricity prices for different
time periods last year in 12 provincial-level regions, and the
measures have proved to be effective.
In general, daytime electricity prices are much higher than
those at night, and in summer and winter, prices are higher than
those during spring and autumn.
The nation is expanding investment in power plant construction
as a way to tackle the shortage.
Power plants with a total installed capacity of more than 80
million kilowatts have been approved since mid-2002, and those with
a further 10 million kilowatts of capacity are awaiting for
approval, according to NDRC.
The installed capacity of new generators due to start operation
this year is estimated at 3.7 million kilowatts, two-thirds of
which will go into operation in the latter half this year.
And for this year's fourth quarter, the power shortage will drop
to about 10 million kilowatts, experts estimate.
With more power stations constructed, experts agree that the
prevailing power shortage will come to an end in two years.
The nation's total power generating capacity will exceed 450
million kilowatts by the end of next year. The figure will rise to
650 million kilowatts in 2010 and 950 kilowatts in 2020, according
to NDRC statistics.
Meanwhile, the railway authorities have allocated more
transportation capacity to deliver coal. Coal deliveries increased
29.5 percent during the first five months of this year.
Some power companies, including Beijing-based Datang Power Corp,
have even invested in building special railways to transport coal
in order to increase fuel supplies.
Thermal power plants account for 70 percent of China's
electricity supply in terms of installed capacity, and coal is
mainly produced in inland regions with less developed economies,
but the insufficient transportation capacity has increased the
power shortfall, creating a bottleneck.
Government bodies including the SERC have drawn up comprehensive
plans to deal with possible electricity emergencies, such as the
blackout that hit the United States and Canada last winter. The
scheme has already been presented for approval to the State
Council, China's cabinet.
But SERC Vice-President Shi Yubo warns that power supply this
year could still be challenged by very high temperature weather,
inadequate fuel supplies and ageing generators.
As the existing generators are all running at full operation, no
more spare capacity remains available and little time is left for
maintenance. The risks of facilities breaking down are increasing,
he explained.
Moreover, relatively power-rich areas, including the Ningxia
Hui Autonomous Region and Qinghai
Province in west China, central China's Henan
Province and the west of north China's Inner
Mongolia Autonomous Region, are witnessing rapid increases in
power demand.
That is mainly the result of the transfer of energy-intensive
industries from coastal regions to inland China, said Shi.
Since the power shortage has increased production costs, some
enterprises in power-hungry regions, in particular those producing
steel, iron and nonferrous metals, tend to move their plants to
where electricity prices are lower.
So far, 11 enterprises from Guangzhou, including manufacturers
and foreign trade companies, have signed contracts to invest in
central China's Hubei
Province, attracted by its lower electricity prices.
(China Daily July 11, 2004)