China's electric power industry has changed dramatically since the early 1990s to become the world's second-largest electricity consumer, after the United States. In April 1996, an Electric Power Law was implemented, a major event in China's electric power industry. This law set out to promote the development of the electric power industry, to protect legal rights of investors, managers and consumers, and to regulate generation, distribution and consumption.
China has abundant energy. The country has the world's third-largest coal reserves and massive hydroelectric resources. But there is a mismatch between the location of the coal fields in the north-east (Heilongjiang, Jilin and Liaoning) and north (Shanxi, Shaanxi and Henan); hydro power in the south-west (Sichuan, Yunnan and Tibet); and the fast-growing industrial load centers of the east (Shanghai-Zhejiang) and south (Guangdong, Guangxi and Guizhou).
Contents |
China's power industry has become increasingly competitive over the past three years as a result of government-initiated structural reforms and China's entry into the World Trade Organization (WTO). Power companies, faced with the pressure of competition, are looking to transform their communications infrastructure to boost efficiency and productivity.
In 2007, China’s energy supply and demand both surged ahead at an amazing pace in the shadow of its 11.4% GDP growth. Total energy consumption increased by 7.8% equivalent to 2.65 billion tons of standard coal while the amount of electric power generated grew by 14.1% in 2007, to 326.32 million kWh. Thermal power still accounts for the bulk of the energy generated, 83%, followed by 14% from hydro, 2% from nuclear and less than 0.1% from wind power.
By the end of 2007, China's total installed capacity amounted to 713 million kilowatts. China's power demand continued a steady growth momentum in 2008, up 13% year on year. With the shutdown of small thermal power generating units and the slowdown of investment in power generation, the high growth rate of China's newly increased installation capacity in 2008 will decelerate, and the rate is expected to reach 11.8% year on year.
In the long term China's power industry, boosted by accelerated process of industrialization and urbanization, will have an average annual growth rate of 6.6% to 7.0% in the next ten years. This indicates that the power industry will require a great deal of investment.
Currently, investment in hydropower, wind power and nuclear power is increasing. However, investment in coal-fired power generation still ranks first.
The structure of China's power industry is expected to remain unchanged for a long time. At present, China's hydropower output amounts to 13.88 percent of the national total, nuclear power output accounts for 1.94 percent and wind power output amounts to 0.26 percent, while coal-fired power output amounts to at least 78% of the national total. China's coal-fired power generation will be in a stage of stable development until at least 2020, and China's installed capacity of coal-fired power generating units will remain at more than 70 percent.
Before 1994 electricity supply was managed by electric power bureaus of the provincial governments. Now utilities have seen been managed by corporations outside of the government administration structure.
To end the State Power Corporation's (SPC) monopoly of the power industry, China's State Council dismantled the corporation in December 2002 and set up 11 smaller companies. SPC had owned 46% of the country's electrical generation assets and 90% of the electrical supply assets. The smaller companies include two electric power grid operators, five electric power generation companies and four relevant business companies. Each of the five electric power generation companies owns less than 20% (32 GW of electricity generation capacity) of China's market share for electric power generation. Ongoing reforms aim to separate power plants from power-supply networks, privatize a significant amount of state-owned property, encourage competition, and revamp pricing mechanisms.[1]
It is expected that the municipal electric power companies will be divided into electric power generating and electric power supply companies. A policy of competition between the different generators will be implemented in the next years .
China's electric power industry continuously maintains a high growth rate. By the end of 2000, the total installed power was 315 GW, that means an increase of 16,5 GW or 5.5% compared to 1999. Hydropower amounted to 77 GW, accounting for 15 %; thermal power amounted to 235 GW, accounting for 83 %.and nuclear power amounted to 2GW, accounting for 1 % of installed capacity. Electricity generation reached 1400 TWh, 13.5 % more than in the previous year. In 1999, the construction investment of the electric power industry reached 14 billion US dollars, of which 49.3 % were dedicated to thermal power, 12.5 % to hydropower 6.4 % to nuclear 26.1 %, to transmission lines and transformers and 5.7 %.to other investments.
By the end of 2010, it is expected that the total installed capacity will reach 900 GW. Annual generation of electricity will exceed 3700 TWh. BY the end of 2007, the total installed capacity was 713.29 GW[2],annual generation of electricity was 3255.9 TWh.[3]
It seems likely the cost of power will need to rise substantially over the medium term (2-5 years) to curb wasteful energy consumption and slow the rate of growth in electricity demand. In theory, the government could raise power costs by a similar amount across the whole of China in the interests of inter-regional equity.
The central government has made creation of a unified national grid system a top economic priority to improve the efficiency of the whole power system and reduce the risk of localised energy shortages. It will also enable the country to tap the enormous hydro potential from western China to meet booming demand from the eastern coastal provinces.
The main problem in China is the voltage drop when power is sent over very long distances from one region of the country to another.
Long distance inter-regional transmission have been implemented by using ultra-high voltages (UHV) of 800kV, based on an extension of technology already in use in other parts of the world.
The government plans as many as eight long-distance UHV lines by 2015 and 15 by 2020.
Following research and testing, SGCC has announced construction of the first long-distance UHV line from Sichuan, which is rich in hydro-electric potential, to the eastern load center of Shanghai.
Shanghai already receives hydro-electric power from the massive Three Gorges Dam on the Changjiang (Yangtze) at Sandouping in Hubei province. But the new DC 800kV UHV line would enable it to receive power from twice as far west from the Xiangjiaba dam on the Jinsha river (a tributary of the Changjiang much further upstream).
Xiangjiaba will have total generating capacity of 6,400 MW. When completed, the nearby Xilodu Dam will add a further 12,600 MW (about 55 percent of the size of the planned Three Gorges output), making it the world's third-largest hydro-electric dam, ranking after the Three Gorges and Brazil's Itaipu.
Xilodu and Xiangjiaba are two of a series of massive new hydro projects that the government plans in south-western and western China to take advantage of the massive run off from the Himalayas and the Tibet plateau.
SGCC plans to bring a single pole of the Xiangjiaba-Shanghai line into commercial operation within two years (2010) and the second pole a year later (2011). SGCC plans to complete a total of 10 UHV projects by 2015 and 15 by 2020. [1] In most cases, these will bring power from massive new hydro facilities in south-western China to the industrial and residential centers of the east.
China's installed hydro capacity in the first half of 2009 was 172GW and constituted about 24% of total power generation capacity. In 2008, hydropower generated 563TWh, which was equivalent to 16% of China's total and 85% of primary electricity generation. As China's potential hydropower capacity (estimates range up to 600GW, but currently the technically exploitable and economically feasible capacity is around 400GW) is only about 25-30% utilized, there remains much space for further hyro development. In comparison, hydro utilization in the U.S. currently is 80% and in Norway, Iceland, and other countries it is at over 90%. Several new units are scheduled to still come online in China in 2009 and the National Development and Reform Commission in the 11th Five-Year-Plan has set a 300GW target for 2020. Due to China's scarcity of fossil fuels and the government's preference for energy independence, hydropower is an attractive option.
Most of China's hydropower stations are located Central and Southwestern China, in particular in Sichuan and Yunnan provinces, where two thirds of China's untapped hyro capacity is located. The West-to-East Transmission program (xidian dongsong), which is a key component of China’s long-term energy strategy, plans to have a grid of UHVDC transmission lines carry bulk loads from 13 designated hydropower bases in Southwest and Western China over several thousand kilometers to the electricity-hungry coastal provinces. These hydropower bases hold 69% of China’s total exploitable capacity and as of 2008, about 180 middle and large-scale dams are currently under construction there.
Hydropower in China has been touted as a renewable and clean energy source, but this masks the fact that large dams, such as the Three Gorges Dam or the Xiluodu dam on the lower Jinsha River, have had detrimental environmental impacts on the areas surrounding dam reservoirs. Erosion, flooding of valuable farmland, and destruction of fish breeding habitats have been typical problems. Moreover, about 15 million people have been relocated due to dam construction since 1949 and often these uprooted local people, in particular in Sichuan and Yunnan, tend to be poor and uneducated farmers, who are strongly attached to their ancestral land and have found it difficult to adapt to the more urban areas they have been resettled to. Growing media and NGO attention on the ecological and social impacts of hydropower and efforts in the central government in recent years to improve the regulatory framework of hydropower development and protect the interests of minority stakeholders, such as displaced locals, indicate that hydropower may eventually become more environmentally and socially sustainable.
Major hydropower corporations
South China from the Changjiang valley down to the South China Sea was the first part of the economy to liberalize in the 1980s and 1990s and is home to much of the country's most modern and often foreign-invested manufacturing industries. Northern and north-eastern China's older industrial base has fallen behind, remains focused on the domestic economy and has suffered relative decline.
Northern and north-eastern China relies heavily on thermal generation from the local coalfields. Northern China will remain reliant on increasingly expensive and polluting thermal generation.
In terms of nuclear power generation, China will advance from the moderate development strategy to accelerating development strategy. Nuclear power will play an even more important role in China's future power development. Especially in the developed coastal areas with heavy power load, nuclear power will become the backbone of the power structure there. China has planned to build up another 30 sets of nuclear power generator within 15 years with total installed capacity of 36 to 40 million kWh, accounting for about 4% of China's total installed capacity of the electric power industry.
In terms of the investment amount of China's listed power companies, the top three regions are Guangdong province, Inner Mongolia Autonomous Region and Shanghai, whose investment ratios are 15.33%, 13.84% and 10.53% respectively, followed by Sichuan and Beijing.
China's listed power companies invest mostly in thermal power, hydropower and thermoelectricity, with their investments reaching CNY216.38 billion, CNY97.73 billion and CNY48.58 billion respectively in 2007. Investment in gas exploration and coal mining follow as the next prevalent investment occurrences.
Major players in China's electric power industry include:
E-commerce in China is developing at full speed with its many advantages including low cost, high efficiency etc. With the advancement of electric power system reform, the electric utility industry of China has already possessed the basic condition of e-commerce development.[2][3]
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China's electric power industry has changed dramatically since the early 1990s to become the world's second-largest electricity consumer, after the United States. In April 1996, an Electric Power Law was implemented, a major event in China's electric power industry. This law set out to promote the development of the electric power industry, to protect legal rights of investors, managers and consumers, and to regulate generation, distribution and consumption.
China has abundant energy. The country has the world's third-largest coal reserves and massive hydroelectric resources. But there is a mismatch between the location of the coal fields in the north-east (Heilongjiang, Jilin and Liaoning) and north (Shanxi, Shaanxi and Henan); hydro power in the south-west (Sichuan, Yunnan and Tibet); and the fast-growing industrial load centers of the east (Shanghai-Zhejiang) and south (Guangdong, Guangxi and Guizhou).
Contents |
China's power industry has become increasingly competitive over the past three years as a result of government-initiated structural reforms and China's entry into the World Trade Organization (WTO). Power companies, faced with the pressure of competition, are looking to transform their communications infrastructure to boost efficiency and productivity.
In 2007, China’s energy supply and demand both surged ahead at an amazing pace in the shadow of its 11.4% GDP growth. Total energy consumption increased by 7.8% equivalent to 2.65 billion tons of standard coal while the amount of electric power generated grew by 14.1% in 2007, to 326.32 million kWh. Thermal power still accounts for the bulk of the energy generated, 83%, followed by 14% from hydro, 2% from nuclear and less than 0.1% from wind power.
By the end of 2007, China's total installed capacity amounted to 713 million kilowatts. China's power demand continued a steady growth momentum in 2008, up 13% year on year. With the shutdown of small thermal power generating units and the slowdown of investment in power generation, the high growth rate of China's newly increased installation capacity in 2008 will decelerate, and the rate is expected to reach 11.8% year on year.
In the long term China's power industry, boosted by accelerated process of industrialization and urbanization, will have an average annual growth rate of 6.6% to 7.0% in the next ten years. This indicates that the power industry will require a great deal of investment.
Currently, investment in hydropower, wind power and nuclear power is increasing. However, investment in coal-fired power generation still ranks first.
The structure of China's power industry is expected to remain unchanged for a long time. At present, China's hydropower output amounts to 13.88 percent of the national total, nuclear power output accounts for 1.94 percent and wind power output amounts to 0.26 percent, while coal-fired power output amounts to at least 78% of the national total. China's coal-fired power generation will be in a stage of stable development until at least 2020, and China's installed capacity of coal-fired power generating units will remain at more than 70 percent.
Before 1994 electricity supply was managed by electric power bureaus of the provincial governments. Now utilities have seen been managed by corporations outside of the government administration structure.
To end the State Power Corporation's (SPC) monopoly of the power industry, China's State Council dismantled the corporation in December 2002 and set up 11 smaller companies. SPC had owned 46% of the country's electrical generation assets and 90% of the electrical supply assets. The smaller companies include two electric power grid operators, five electric power generation companies and four relevant business companies. Each of the five electric power generation companies owns less than 20% (32 GW of electricity generation capacity) of China's market share for electric power generation. Ongoing reforms aim to separate power plants from power-supply networks, privatize a significant amount of state-owned property, encourage competition, and revamp pricing mechanisms.[1]
It is expected that the municipal electric power companies will be divided into electric power generating and electric power supply companies. A policy of competition between the different generators will be implemented in the next years .
China's electric power industry continuously maintains a high growth rate. By the end of 2000, the total installed power was 315 GW, that means an increase of 16,5 GW or 5.5% compared to 1999. Hydropower amounted to 77 GW, accounting for 15 %; thermal power amounted to 235 GW, accounting for 83 %.and nuclear power amounted to 2GW, accounting for 1 % of installed capacity. Electricity generation reached 1400 TWh, 13.5 % more than in the previous year. In 1999, the construction investment of the electric power industry reached 14 billion US dollars, of which 49.3 % were dedicated to thermal power, 12.5 % to hydropower 6.4 % to nuclear 26.1 %, to transmission lines and transformers and 5.7 %.to other investments.
By the end of 2010, it is expected that the total installed capacity will reach 500 GW. Annual generation of electricity will exceed 2040 TWh. BY the end of 2007, the total installed capacity was 713.29 GW[2],annual generation of electricity was 3255.9 TWh.[3]
It seems likely the cost of power will need to rise substantially over the medium term (2-5 years) to curb wasteful energy consumption and slow the rate of growth in electricity demand. In theory, the government could raise power costs by a similar amount across the whole of China in the interests of inter-regional equity.
The central government has made creation of a unified national grid system a top economic priority to improve the efficiency of the whole power system and reduce the risk of localised energy shortages. It will also enable the country to tap the enormous hydro potential from western China to meet booming demand from the eastern coastal provinces.
The main problem in China is the voltage drop when power is sent over very long distances from one region of the country to another.
Long distance inter-regional transmission have been implemented by using ultra-high voltages (UHV) of 800kV, based on an extension of technology already in use in other parts of the world.
Following research and testing, SGCC has announced construction of the first long-distance UHV line from Sichuan, which is rich in hydro-electric potential, to the eastern load center of Shanghai.
Shanghai already receives hydro-electric power from the massive Three Gorges Dam on the Changjiang (Yangtze) at Sandouping in Hubei province. But the new DC 800kV UHV line would enable it to receive power from twice as far west from the Xiangjiaba dam on the Jinsha river (a tributary of the Changjiang much further upstream).
Xiangjiaba will have total generating capacity of 6,400 MW. When completed, the nearby Xilodu Dam will add a further 12,600 MW (about 55 percent of the size of the planned Three Gorges output), making it the world's third-largest hydro-electric dam, ranking after the Three Gorges and Brazil's Itaipu.
Xilodu and Xiangjiaba are two of a series of massive new hydro projects that the government plans in south-western and western China to take advantage of the massive run off from the Himalayas and the Tibet plateau.
SGCC plans to bring a single pole of the Xiangjiaba-Shanghai line into commercial operation within two years (2010) and the second pole a year later (2011). SGCC plans to complete a total of 10 UHV projects by 2015 and 15 by 2020. [1] In most cases, these will bring power from massive new hydro facilities in south-western China to the industrial and residential centers of the east.
China is speeding up its hydropower development and its hydropower installed capacity will reach 250 GW by the year 2020. This means that 46-47% of China's water resource will be exploited and utilized by then.
China has massive untapped potential for generating hydro-electric power. The government's official survey data show the country could theoretically generate 694 GW from hydro sources, of which about 541 GW is technically feasible and 401 GW is economically feasible.
By end-2005, the country had installed 130 GW of hydro capacity. But there was still another 270 GW of capacity which would be both technically and economically feasible to develop. Untapped economically feasible hydro potential is equivalent to 4.5 times the peak summer power demand of Guangdong province - the site of China'a massive export-oriented and often foreign-invested manufacturing hub.
Two-thirds of the untapped hydro potential is located in the two neighbouring provinces of Yunnan and Sichuan in the south-west, which could each generate an additional 87 GW of power from hydro sources. The key point is both provinces could be linked by UHV transmission lines to the major load centres at Guangdong on the south coast and Shanghai-Zhejiang on the east coast.
Dams and power lines are already under construction. Provided both technologies can be mastered, south China's power problems could be solved within the next 4-7 years.
Major hydropower corporations
South China from the Changjiang valley down to the South China Sea was the first part of the economy to liberalize in the 1980s and 1990s and is home to much of the country's most modern and often foreign-invested manufacturing industries. Northern and north-eastern China's older industrial base has fallen behind, remains focused on the domestic economy and has suffered relative decline.
Northern and north-eastern China relies heavily on thermal generation from the local coalfields. Northern China will remain reliant on increasingly expensive and polluting thermal generation.
In terms of nuclear power generation, China will advance from the moderate development strategy to accelerating development strategy. Nuclear power will play an even more important role in China's future power development. Especially in the developed coastal areas with heavy power load, nuclear power will become the backbone of the power structure there. China has planned to build up another 30 sets of nuclear power generator within 15 years with total installed capacity of 36 to 40 million kWh, accounting for about 4% of China's total installed capacity of the electric power industry.
In terms of the investment amount of China's listed power companies, the top three regions are Guangdong province, Inner Mongolia Autonomous Region and Shanghai, whose investment ratios are 15.33%, 13.84% and 10.53% respectively, followed by Sichuan and Beijing.
China's listed power companies invest mostly in thermal power, hydropower and thermoelectricity, with their investments reaching CNY216.38 billion, CNY97.73 billion and CNY48.58 billion respectively in 2007. Investment in gas exploration and coal mining follow as the next prevalent investment occurrences.
Major players in China's electric power industry include:
E-commerce in China is developing at full speed with its many advantages including low cost, high efficiency etc. With the advancement of electric power system reform, the electric utility industry of China has already possessed the basic condition of e-commerce development.[2][3]
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  | Reform of China's electric power industry: facing the market and competition - IngentaConnect Reform of Chinas electric power industry: facing the market and c... |
| | China Electric Power Database - China Power Grid Resources |
| | China Electric Power Statistical Yearbook,2007 - China Electric Power Statistical Yearbook,2007 - market research report |
| | China's oversupply of electric power worrisome - hktdc.com - Economic & Business Trends |
| | Electric Power System in China - Welcome to IEEE Xplore 2.0: Electric Power System in China; History of Development, Present status & Future perspective |
| | Brief Introduction Of CEC - welcome to cec.org.cn |
| | China EPower Forum - China EPower 2009 | 23-25 April 2009 | Intex Shanghai |
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