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1Q power supply sufficient

(Dow Jones)
Updated: 2007-04-30 13:58

China's electricity supplies were mostly sufficient in the first quarter due to the rapid growth of new generation capacity, the China Electricity Council said Saturday.

An oversupply of electricity may occur in some regions in the second quarter because of rich hydropower resources in the summer, the industry agency, which monitors all of China's power enterprises, said in a report published on its Web site.

Total power yield in the first quarter reached 701.2 billion kilowatt-hours, up 15.5% on year and 4.4 percentage points higher than the growth rate in the same quarter of last year.

Meanwhile, total power consumption reached 718.9 billion kWh in the first quarter, up 14.92% on year and 3.11 percentage points higher than the growth rate in the same period of last year.

The growth rate of domestic power production exceeded power consumption in the first quarter, although China still imported power from Russia and Mongolia.

The high growth of power yield was due partly to newly increased power generation capacity. Newly installed capacity reached 13.13 gigawatts in the first quarter, including 12.6 gigawatts of coal-fired capacity and 323 megawatts of hydropower capacity, it said, additional to the total capacity of 622 gigawatts at the end of 2006.

Given sufficient supplies, the usage hours of power generation facilities fell to 1,174 hours on average in the first quarter, 64 hours less than the same period last year, which may reduce power generators' profit margins, said the report.

Generation facilities' usage hours may drop further in the second quarter, when China is expected to install 27 gigawatts of additional power generation capacity, double the level in the first quarter, said the report.

Power shortages in the summer will narrow noticeably in industrial southern and eastern regions, while oversupply may occur in other regions, it said.

The report suggested that power companies shut down more aging and inefficient power generation units. China targets to close 50 gigawatts of such units by 2010.