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Power pinch may stall economy
( 2003-06-19 10:14) (China Daily)

Electricity shortages are likely to continue to stall the economic development of nearly half of China's provinces in the near future.

The insufficient supply of power will continue in 2004 and it is estimated that China will be short of 15 million kilowatts of generating capacity next year, according to a recent report by the National Power Network Company.

Officials with the National Development and Reform Commission (NDRC) told China Daily that regional shortages since last year mainly resulted from inefficient construction of electrical generators during previous years along with a rapid increase in power demands.

"The judgment inside the industry and the power policy of the government have mainly contributed to the current situation," said Gao Shixian, branch director with the Energy Research Institute affiliated to the NDRC.

During 1996 and 1997, the supply of electricity had greatly exceeded demand in most parts of China, leading the government to cancel plans to construct more power plants, said Gao.

"The popular judgment in the sector during that time was that no more generators were needed," said Gao.

But the country's electricity demand has picked up since last year partly because the electricity transmission network in most rural areas of China has been improved and prices have gone down.

Meanwhile, an investment peak in industrial production in many regions of China since 2001 has also boosted power demands.

More and more city-dwellers have also chosen to outfit households with air conditioners and other electrical appliances, which Gao says has worsened shortages.

Power shortfalls have occurred in 16 provinces and municipalities, while 14 provinces and municipalities suffered from the strain in 2002, the company report explained.

The demand for electricity is expected to rise by 9 to 10 per cent this year with power shortages emerging in China's economically booming southern and eastern areas. A supply gap of 10 million kilowatts of generating capacity is expected this summer, the association's report said.

An official surnamed Song with the Energy Bureau of the commission said the government is making efforts to meet the power demands for China's economic development and social needs.

The Chinese Government recently approved the construction of 13 large-scale power plants, with a total investment of 51.2 billion yuan (US$6.2 billion). The plants, for which construction will begin by 2005, will have a total electricity-generating capacity of 11.88 million kilowatts.

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