Commission moves to ensure energy supply
By Xie Ye (China Daily)
Updated: 2004-05-20 08:43

Amid criticism over the government's failure to address the current energy shortage, the National Development Reform Commission (NDRC) has defended its efforts to ensure supply.

In an interview with China Central Television Station, officials from the commission's Energy Bureau admitted that an electricity shortage is looming and thermal coal supplies are dwindling.

The officials, however, indicated that the energy supply is adequate, and it was abnormally-fast growth on the demand side that is causing the shortfall.

The officials said the commission is working on reinforcing control of the growth of demand while trying to increase energy supply.

The officials' statement came at a time when public criticism about the coal and electricity shortage is mounting.

Almost all the nation's mainland territory - except the remote Xinjiang Uygur Autonomous Region, Hainan Island and three provinces in Northeast China - have suffered from chronic blackouts and electricity rationing during the first quarter of this year.

Experts predict the power shortage will worsen in summer when consumption surges as more air conditioners are brought into use.

Meanwhile, many power plants are running out of coal for power generation. Stocks in major power plants may only last for a day or two. Some have even been forced to suspend operations.

"As the person in charge of the energy sector, I am concerned," said bureau director Xu Dingming in the interview.

Xu was referring to his feeling when he heard of a letter from a middle-school student in Zhejiang Province - one of the places most seriously hit by power shortages. In the letter, the boy complained that he could not finish his homework because of the electricity being cut off in his hometown.

Experts have held the NDRC responsible for the electricity shortages which started last year. Experts say the government failed to approve the construction of sufficient power plants in previous years as it underestimated power demands.

Experts and insiders also blamed the commission's failure to settle conflicts between coal and power companies to ensure a stable coal supply.

Officials from the Energy Bureau have defended their position. They insisted that the coal and power supply is adequate.

"(The generation capacity of) new power plants that we build in a year is equivalent to half of the total capacity of Britain, and equivalent to the total capacity of Brazil," said Xu. "The development of power, coal and oil industries is fairly fast."

In the first four months of this year, coal output increased by 16.2 per cent year-on-year to 469.3 million tons.

During this time, electricity generation increased by 15.8 per cent to 647.3 billion kilowatt hours compared with the same period last year, according to the National Bureau of Statistics.

About 70 per cent of the new power plants in the world are being built in China.

Wang Jun, deputy director of the bureau, said new plants with combined capacity of 30,000 megawatts will begin construction this year.

Still, the country is short of generation capacity by 20,000 megawatts this year, 5,000 megawatts more than last year's shortage.

Other experts are more pessimistic, expecting the electricity supply-demand gap this year to reach 30,000 megawatts.

Wang said: "We cannot meet demand by only increasing production."

Wang said electricity demand could be reduced by 10,000 megawatts through energy saving and conservation.

The NDRC earlier urged the reinforcement management of demand for electricity. Major efforts include raising the electricity tariff at peak consumption time while lowering the price for night consumption; rescheduling the worktime of factories to balance consumption between day and night.

Xu said the central government plans to increase the GDP by 2020 to four times that of 2000. Should China fail to increase efficiency of energy consumption, the energy supply would also have to increase by four times, which is not economically feasible.

"We plan to only double energy supply to meet the GDP growth target in our efforts to tap the potential of energy reserves," said Xu.

The officials also noted the government's work to safeguard the oil supply by setting up a strategic oil reserve.

Bai Chunrong, another deputy director of the bureau, said the construction of the initial phase of the strategic oil reserve has started in four bases in Dalian, Huangdao, Zhenghai and Zhoushan.

The construction is expected to be completed by 2006-2008.

By 2015, the reserve could sustain the country's oil consumption for 90 days.

The government is inviting bidding for the construction of storage and infrastructure facilities at the four sites.

The commission is also drafting laws and regulations to manage the reserve, said Bai.

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