Summer may see blackouts

China will not face major power shortages this summer but some regions may see blackouts, according to the country's electricity regulatory body.

"This summer the gap between power supply and demand will be 16 gW," said an official with the State Electricity Regulatory Commission yesterday, declining to be named.

The State Grid Corporation of China, which oversees power supply in 26 provinces of the country, said the company would see 10 gW of power shortage in summer. China Southern Power Grid, which is responsible for power systems in five provinces in South China, said it would see 6 gW of shortage in summer.

According to the two power grids, most parts of China will see record power consumption this summer, posing a huge challenge to both. The flood in the south and the Sichuan earthquake have also affected power supply.

Shortage of coal used for power generation is putting great pressure on electricity generation. In Shanxi, which produces a fourth of China's total coal, local media reported that power-generating units with a total capacity of 3,665 mW had halted operation because of coal shortage.

Driven by booming demand, many coal companies have increased their production. However, although this year's coal production in the province will reach 680 million tons, up 9 percent from a year earlier, it still can't catch up with the development of downstream businesses such as power generation, according to Shanxi Province Electric Power Association (SEPA).

All coal companies in Shanxi have increased their product prices this year. Soaring coal prices have mounted great pressure on the downstream business, with power generation the worst affected.

Coal accounts for over 70 percent of the total cost of thermal power plants, said Li Jianwei, head of SEPA. Power plants in Shanxi are experiencing their hardest time, said Li.

China's major power companies reported huge losses this year in the face of soaring coal prices. Of the country's five leading power producers, only China Huaneng Group did not report losses in the first quarter.

Electricity output by China's major power plants jumped 13.7 percent year-on-year in the first five months to meet higher demand. Power generators with installed capacities of at least 6,000 kW produced 1.39 trillion kWh of electricity, said the China Electricity Council.

Power consumption rose 12.4 percent to 1.4 trillion kWh from January to May, the industry association said.

During this period, China invested 100.5 billion yuan in expanding power generation capacity, helping add 23.4 million kW of installed capacity, it said.