Power security to become top priority
By Xie Ye (China Daily)
Updated: 2004-02-25 09:42

In the face of increasing electricity shortfalls this year, the power industry watchdog summoned heads of major power-generating and grid companies to Beijing on February 24 to study the security of electrical production.

Officials from the State Electricity Regulatory Commission on February 24 made security issues the top priority for the industry this year.

It is also going to pass stricter regulations today to reduce accidents that may cause losses of life, massive blackouts and the collapse of grids.

This is a marked shift for an earlier government strategy, which has always stressed pushing through market-oriented reforms to increase competition in the industry since late 2002.

"Any reform plans or policies should be conducive to the security of the power system," said Commission Chairman Chai Songyue yesterday at a national conference on the security of electricity production. "The economic interests of enterprises should yield to security concerns when they conflict with each other."

Chai added that generating companies should increase investment to improve security facilities.

Concerns over the security of the power industry are growing as generating plants and grids may have few chances for maintenance this year, with the increasing power supply shortfall.

It is widely expected that China will suffer more from the electricity shortage this year after more than two-thirds of the nation's areas suffered from chronic blackouts or electricity rationing in summer and winter months.

Chai yesterday said that some of the grids are on the verge of collapse, with a zero reserve margin.

The normal level should be 10 per cent of the total transmission capacity.

The commission yesterday predicted that the country will lack the generating capacity of 20,000 megawatts needed this year, an increase from a shortfall of 15,000 megawatts last year.

The calculation is based on estimations that the national GDP (gross domestic product) will grow by 7 per cent and that electrical consumption will rise by 11 per cent year-on-year.

Experts from the State Grid Corp, which oversees most of China's transmission assets, are more pessimistic. They expected that the supply-demand gap could be as much as 30,000 megawatts when considering that consumption may increase by 12 per cent this year.

In the commission's estimation, the East China Grid, which covers economic locomotive areas such as Jiangsu and Zhejiang provinces and Shanghai, is expected to lack a generating capacity of 10,000-15,000 megawatts needed this year.

The South China Grid currently lacks 5,000 megawatts, North China Grid has a shortfall of 3,000 megawatts, and the Central China Grid needs another 3,000 megawatts.

Chai said the security threat has also intensified with the government's separation of power companies from power grids in an industry overhaul late in 2002. The separation makes it difficult for the grids to co-ordinate electrical transmission and distribution from different power plants.

The fragile transmission lines also are fuelling those worries about stable electrical supply, Cai added.

In response to the stark situation, Chai urged the companies to make every effort to ensure that power supply needs are met, and increase the power transmission from electricity-rich areas to power-pinched regions.

The companies should also establish a contingency system as soon as possible to handle emergencies.

He also urged generation and grid firms to co-ordinate with each other to facilitate better power transmission and distribution.