Long-term electricity demand in China — From quantitative to qualitative growth?

Abstract

This paper develops scenarios of electricity demand in China until 2010, at a national, a sectoral and a regional level. It takes into account the recent macroeconomic downturn in the Chinese economy and the potential effects of deregulation and price increases in the power sector. The medium-growth scenario hints at a gross electricity demand of 1500 TWh in 2010; should the structural change from agriculture and heavy industry towards light industry and services accelerate, electricity demand may be another 10% lower. These figures are significantly below the projections fixed in the government's 9th five-year plan, which forecasts a demand of 2500 TWh. The aggregate and sectoral scenarios imply that current development plans for generating capacity and coal consumption until 2010, too, need to be scaled down. The disaggregation at the level of the 13 inter-provincial and provincial power grids hints at potential regional discrepancies: the large industrial areas in eastern China and the Central region are likely to face overcapacity, whereas North China and the peripheral regions may face deficits.