"With the formation of the new company, power generators in Guangxi, Guizhou, Yunnan, Hainan and Guangdong will compete to supply the (Guangdong) power grid," said Yuan Maozhen, president of the new company, at its launch ceremony on Monday evening.

"That will lead to cheaper power for end-users and make them more willing to use the power transmitted from the western regions."

China Southern Power Grid Corp Ltd, established late last December, is a combination of the Guangdong Power Group and Hainan Power Corp. It also uses the former State Power Corp's grids in Guangxi, Yunnan, and Guizhou in western China.

The total assets of the new power-grid operator surpass 200 billion yuan (US$24.10 billion) and its registered capital is 60 billion yuan (US$7.23 billion).

According to You Ningfeng, vice-governor of Guangdong Province, the province will absorb all the power the western regions can produce.

And senior officials with Yunnan, Guizhou and Guangxi vowed to redouble efforts to generate and supply power to Guangdong Province through the power grid.

Official statistics indicate that Guangdong Province consumed 16,000 gigawatt-hours in electric power from the western regions, less than 10 per cent of the total power consumed in the province, at an average price of 0.308 yuan (4 US cents) per kilowatt/hour in 2002.

And they said that greater use of power supplied by the western regions will be mutually beneficial to the economic development of Guangdong and that of the western regions, including Guangxi, Guizhou and Yunnan.

(China Daily January 8, 2003)