China’s Insatiable Energy Appetite

As the Chinese economy continues its rapid expansion, energy supplies are falling far short of demand, forcing development of new generating facilities and creating new markets for international equipment manufacturers.

Electricity consumption in just the first four months of 2004 totaled 650.5 billion kWh—up 16.1% over the same period in 2003, according to the State Electric Power Regulatory Commission and reported by the Xinhua News Agency. Third-quarter 2004 generating capacity is expected to fall some 30 million kW short of demand, according to sources in the China Electricity Council.

Recent projects to address the shortfall include a new 500-kV transmission system running from the massive Three Gorges Dam to Guangdong Province. Additionally, some 37,000 MW of generating capacity is expected to be added to the nation’s grid by the end of this year, according to a recent report in China Daily .

The rapid buildup in generating, transmission and distribution capacity has not gone unnoticed by industry leaders elsewhere. Siemens has formed a new wholly-owned subsidiary, Siemens Power Automation (China) Ltd., in Nanjing, Jiangsu Province—itself the beneficiary of a second 500-kV transmission line from Three Gorges Dam. Siemens has already invested US $8.4 million in the new company, according to China Daily .

China’s far-flung population means many of its citizens live in hard-to-reach off-grid locations, creating a market for distributed-generation technologies, such as solar power. Shell Solar has begun an effort to bring solar-generated electricity to 26 remote villages, with approximately 1,300 households, in the rural southwest of the country, according to SolarAccess.com . The company is also working on a separate project intended to serve up to 78,000 nomadic households.

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