Accelerating development of power-intensive machinery, auto, steel and manufacturing sectors, the growing pace of urbanization and low energy efficiency are blamed for China's extensive shortage of energy, which may worsen before 2020. An industrial report of the State Information Center with the National Bureau of Statistics forecasts China will face a more severe power shortage this year than it did in 2003.
A total of 24 provincial areas imposed power brownouts in the past few months. In an exclusive interview with Xinhua earlier this week, Xu Dingming, a leading official with the Energy Bureau of the State Development and Reform Commission, said China's output of primary energy was equal to 1.603 billion tons of standard coal last year, up 11 percent over the previous year. But demand outpaced supply as shortages of coal, power and oil were reported in many areas of China, whose economy grew by 9.1 percent last year, and over 7 percent in the two years before 2003.
Last year saw many coal-fired power plants in China sound the alarm bell of running out of coal, and 22 provincial areas imposed brownouts due to power shortage. China produced 170 million tons of crude oil and imported about 100 million tons of crude and refined oil.
Xu said China is now in the middle stage of industrialization phase characterized by faster development of energy-extensive machinery, auto, iron and steel sectors. Urban residential consumption of energy also rose dramatically due to the country's fast pace of urbanization and improved standard of living.
Statistics from the Ministry of Construction show that from 1978 to 2002, the level of urbanization in China increased from 17.92 percent to 39.1 percent. By the end of 2002, there were 660 cities and 20,600 towns in China with a combined population of 502 million. A growing number of the urban residents have more spacious houses, more electronic consumer goods and cars, which push up the per-capita consumption of energy, said Xu.
The per-capita energy consumption for urban residents is 250 percent more than that of their rural cousins, said Xu. Meanwhile, overseas investors are relocating their processing and manufacturing sectors, especially the manufacturing sector characterized by high energy consumption, to China, further overstraining the country's energy supply. Excessive investment in the country's iron and steel, electrolytic aluminum, and cement sectors has been another contributing factor of the power shortage, said the official.
Low energy efficiency remains a problem for China as its comprehensive energy efficiency stands at 33 percent, 10 percentage points lower than that of developed countries, and China's energy consumption for per-unit output value is twice as much as that of developed countries, said Xu. A survey conducted by China's power sector shows its coal-fired power plants and power transmission companies would save an equivalent of 120 million tons of standard coal if their energy efficiency was raised to the advanced level of developed countries.
Wang Guangtao, minister of construction, said energy consumption of buildings in China is double or triple that of developed countries of comparable climate.Experts estimate that if new buildings and existing buildings in China all conform to advanced energy conservation standards by 2020, their energy consumption would drop by an equivalent of 335 million tons of standard coal per year, compared with doing nothing at all. That's about one fifth of China's annual energy consumption.
The shortage signals more problems than it appears, such as the country's worsening pollution due to growing consumption of coal, and energy security, said Xu.
Worsening pollution from burning coal
Xu said China's energy sector has to face two major challenges as growing energy supply will pose pressure on the environment and low energy efficiency has become a major constraint on the expansion of the energy sector and sustainable social and economic problems. Coal accounts for 80 percent of the country's energy consumption.
China discharged 19.27 million tons of sulfur dioxide in 2002, 90 percent of which came from burning coal, and 200 million tons of ash and solid waste.The country's environmental watchdog said the amount of sulphur dioxide resulted in acid rain pollution in one third of the country, causing billions of dollars in economic losses.But China's energy demand in 2020 is projected at 3 billion tons of standard coal, almost double that of its output for 2003, which means pollution arising from coal-burning would worsen accordingly, putting further pressure on the country's water resources and transporting system.
Based on China's current coal production plans and decrease of producing capacity of existing coal mines, officials said the country's coal supply would be at least 100 million tons short of demand by 2010, and the shortage would jump to 600 million tons by 2020.
Efforts to increase supply, save energy
In order to ease the current energy shortage, the Chinese government decided earlier this month on a package of measures to deal with the issue, such as curbing blind investment and wasteful duplications in some industries and cutting irrational demand, improving coal supply for areas suffering from power shortage, accelerating construction of energy and transport projects to expand supply and improving efficiency of energy consumption.
Officials and experts said China's power shortage would ease in 2005 and disappear in 2006 due to increased energy supply, but the balance between the supply and demand would not last long if China failed to boost supplies.
More than 200 billion yuan (about 24.1 billion US dollars) of capital went to the construction of power generating projects in 2003, almost equaling the amounts of 2001 and 2002 combined.
Zhou Heliang, executive vice president of the China Electrotechnical Society (CES), said that China's installed power generating capacity would experience big growth from now to 2020.
He said China had 380 million kilowatts of installed power generating capacity by the end of 2003. The level might exceed 450 million kilowatts by 2005, 650 million kilowatts by 2010 and around 950 million kilowatts by 2020.
A week-long nationwide campaign to educate the public about methods to save energy, sponsored by a number of government agencies, started on June 6. Among these methods, citizens are advised to unplug their electrical appliances if they would lay idle for a long period, avoiding power consumption from the standby mode.
Deliberations on energy efficiency in buildings have surfaced and some cities have taken steps in this direction.
Shanghai has taken the lead in the reform. Design and construction of new residential buildings and public buildings in the country's biggest industrial city must comply with energy conservation standards as of 2006.