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China is looking for solutions to its increasingly serious power shortage as demand for electricity is expected to continue rising next year.

China will give priority to power supply for residential quarters and schools, increase power production, do away with preferential policies formulated by localities to boost power consumption when supply exceeds demand, and restrict the expansion of some energy-intensive industrial projects.

Chen Jinxing, deputy general manager of the State Grid Corporation, said a growing demand for power and inadequate increases in power generating capacity in the coming year means the gap between supply and demand will become even wider.

"Electricity consumption has been growing by at least 15 percent on average for the past 17 months since June, 2002. Twenty- one provincial areas, or two thirds of China's total, had to limit the use of electricity due to power shortages," said Chen.

The power shortage has affected people's lives and economic growth, said the deputy general manager.

According to the State Grid Corporation, China's electricity consumption would grow to 2,091 billion kwh in 2004, up 207 billion kwh over 2003. Power shortage would worsen and more areas would encounter blackouts.

The Chinese government has decided on six-point measures to boost power generation and supply at a recent special meeting, Chen noted.

As part of the measures, power companies across the country have been told to operate at full capacity next year to generate electricity, while new policies will be introduced to encourage consumers to save on power and the government has decided to accelerate construction of new power projects.

Chen went on to say that the central government will coordinate coal, power and transport sectors in a bid to ensure power supply by stepping up construction of 13 big coal producing bases, increasing coal supplies and improving pricing of coal and electricity.

"Since early this winter, seven provinces have enforced blackouts in selected areas because their power grid fail to cope with all the demand," said Zhao Zunlian, director of the control center of the State Grid Corporation.

The State Electric Power Regulatory Commission attributed the situation to a number of factors, which include"-- Owing to dry spells that plagued China this year, water levels are especially low this winter and hydroelectric plants are unable to operate to their full capacity;

-- Many thermal power plants, which constitute the bulk of China's power supply, are operating below their capacity because of inadequate coal supply;

-- Use of electricity in heating systems rose dramatically this winter; and

-- Energy-intensive industries, including the production of steel and nonferrous metals have been growing quickly.

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