Power-boost plan to help Pearl River Delta
With the annual summer electricity shortages approaching, red-chip company China Resources is doing its bit to alleviate power problems in the Pearl River Delta by expanding its coal-fired plant in central Hunan province .
The Hong Kong-listed company plans to invest about 5.4 billion yuan during the next two years, adding more generators to its plant in Chenzhou city . It has already obtained the central government's approval for the expansion.
Chen Bin , deputy general manager of China Resources Power Hunan Liyujiang, said the expansion work would start in July and the generators could be in operation by 2007.
All of the power produced by the Chenzhou plant - 4 billion kilowatts a year - goes straight to Guangdong and Mr Chen said the figure would double when the new generators were installed.
The Pearl River Delta has become the mainland's most important manufacturing centre and export powerhouse, but it has been troubled by power and labour shortages in recent years.
'The National Development and Reform Commission told us to go ahead because of the severe power shortages in the Pearl River Delta,' Mr Chen said.
The area relies on inland provinces for electricity. Many experts believe power shortages will be worse this year, with demand expected to increase 18 per cent.
It is not only the Pearl River Delta that is feeling the power pinch - inland provinces such as Hunan are also coming under pressure as the price of coal increases and demand for electricity rises.
Mr Chen said his plant's production costs had increased with the price of coal rising more than 8 per cent this year. 'I think our profits will drop a bit this year because of the higher production costs.'
Half of the electricity generated in Hunan is produced by coal-fired power plants, but Peng Tuyuan , vice-director of the Reform and Development Office in Hunan, said a request for a nuclear power plant had been submitted to the central government.