Power mar­ket tipped for record 2018

China Daily (Hong Kong) - - BUSINESS - By LIU ZHIHUA li­uzhi­[email protected]­nadaily.com.cn

In­dus­try in­sid­ers say 2018 has been a record year for the Chi­nese elec­tric­ity mar­ket, with new highs pre­dicted for to­tal elec­tric­ity con­sump­tion, the av­er­age amount gen­er­ated each day, and year-on-year growth, all driven by China’s up­grad­ing econ­omy.

“Elec­tric­ity gen­er­a­tion and con­sump­tion fig­ures are among the best and most straight­for­ward in­di­ca­tors for a so­ci­ety’s eco­nomic qual­ity,” said Han Xiaop­ing, chief an­a­lyst with China En­ergy Net Con­sult­ing.

“Those in­creases just demon­strated that the Chi­nese econ­omy is de­vel­op­ing healthily and has strong in­ter­nal growth im­pe­tus that out­weighs the neg­a­tive in­flu­ence from the out­side.”

Al­though of­fi­cial sta­tis­tics for De­cem­ber haven’t yet been re­leased, in­dus­try data point to a strong end to record-break­ing first 11 months.

Ac­cord­ing to the Na­tional En­ergy Ad­min­is­tra­tion, from Jan­uary to Novem­ber in 2018 the coun­try’s to­tal elec­tric­ity con­sump­tion was 6.22 tril­lion kilo­watt-hours, up 8.47 per­cent year-on-year. Growth was 2 per­cent­age points faster than the same pe­riod in 2017.

For elec­tric­ity gen­er­a­tion, the NEA said China cre­ated a record 6.16 tril­lion kWh in the first 11 months of 2018, up 6.9 per­cent yearon-year. Av­er­age daily elec­tric­ity gen­er­a­tion was 18.47 bil­lion kWh in 2018, up 8.52 per­cent year-on-year.

The short­fall be­tween power gen­er­ated and de­mand was made up by im­ported power, and ex­am­ples such as fac­to­ries run­ning their own gen­er­a­tors.

In all, six re­gional power grids and 26 re­gional power grids saw higher peak loads in the past year, in­clud­ing in places such as North China, South­west China, and Shan­dong and He­nan prov­inces, ac­cord­ing to a re­port by busi­ness news pub­li­ca­tion Eco­nomic In­for­ma­tion Daily.

The uti­liza­tion rate of power grids in the North­east and the North­west, and a group of prov­inces in­clud­ing Hu­nan, also hit record highs in De­cem­ber, the re­port said.

De­mand jumped across all sec­tors rang­ing from agri­cul­tural, in­dus­trial and ser­vice in­dus­tries, and re­flected the in­creas­ing liv­ing stan­dards of Chi­nese peo­ple in both ur­ban and ru­ral ar­eas, said Han.

Ac­cord­ing to the NEA, elec­tric­ity con­sump­tion in the pri­mary in­dus­try was 0.67 tril­lion kWh in the first 11 months, up 10 per­cent year-on-year.

In the in­dus­trial sec­tor, con­sump­tion to­taled 4.27 tril­lion kWh, up 7.1 per­cent year-on-year, and for the ser­vice sec­tor, the num­bers were re­spec­tively 0.99 tril­lion kWh and 12.8 per­cent.

Elec­tric­ity con­sump­tion for house­hold use was 0.90 tril­lion kWh, a year-on-year in­crease of 10.5 per­cent.

“The Chi­nese econ­omy is up­grad­ing and trans­form­ing, from de­pen­dent tra­di­tional in­dus­tries to high­end, man­u­fac­tur­ing-based and ser­vice-fo­cused,” Han said.

He ex­plained that com­pa­nies in nearly all in­dus­trial sec­tors in China have been in­stalling in­tel­li­gent man­u­fac­tur­ing and ad­vanced in­dus­trial au­to­ma­tion sys­tems in re­cent years, which has in­creased elec­tric­ity de­mand as they de­pend on power to de­velop and func­tion.

“The use of in­dus­trial au­to­ma­tion or in­dus­trial robots is in­creas­ing ex­po­nen­tially in China, re­gard­less of in­dus­trial and re­gional dif­fer­ences,” Han said, cit­ing ex­am­ples of in­dus­trial ro­bot- backed fac­to­ries spring­ing up in Sichuan and Shanxi prov­inces, which have tra­di­tion­ally lagged be­hind eco­nom­i­cally com­pared with China’s coastal ar­eas.

Smart robots and new en­ergy ve­hi­cles are also at the core of China’s mod­ern lo­gis­tics in­dus­try, es­pe­cially in dis­tri­bu­tion cen­ters, an ex­am­ple of the fast devel­op­ment of the ser­vice sec­tor with a fo­cus on new tech­nol­ogy ap­pli­ca­tions in China, Han said.

Even in agri­cul­tural ac­tiv­i­ties, com­puter and in­ter­net tech­nolo­gies are tak­ing an in­creas­ingly big­ger role, which all con­trib­ute to the in­creas­ing elec­tric­ity use, he added.

Han at­trib­uted the elec­tric­ity con­sump­tion growth in peo­ple’s daily lives mainly to ris­ing in­comes.

The higher en­ergy con­sump­tion comes as res­i­dents, es­pe­cially in the Bei­jing-Tian­jin-He­bei re­gion, turn their backs on coal heat­ing for cleaner elec­tric op­tions.

How­ever, Lin Bo­qiang, head of the China In­sti­tute for Stud­ies in En­ergy Pol­icy at Xi­a­men Univer­sity, says that shift ac­counts for only a small frac­tion of the growth in China’s elec­tric­ity con­sump­tion.

The in­crease is driven by en­er­gy­heavy in­dus­tries, such as steel and ce­ment, which ac­count for a big­ger role in driv­ing the growth, and the in­crease in such in­dus­tries are mainly due to the coun­try’s in­fra­struc­ture con­struc­tion, Lin said.

SONG WEIXIN / FOR CHINA DAILY

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