Mainland firms to build plants abroad to ensure power supply

PUBLISHED : Tuesday, 20 June, 2006, 12:00am
UPDATED : Tuesday, 20 June, 2006, 12:00am

China has signed agreements to build power plants in Russia, Mongolia and Kazakhstan, and import electricity from them.

Experts said more companies were expected to invest abroad and transmit power back to the mainland in order to acquire cheaper resources internationally. They also warned that the projects could see neighbouring countries suffer from worsening pollution.

Liu Zhaoshao , chief economist of the State Grid Corporation, told a recent energy forum that it was negotiating with relevant parties and the deals were pending final approval from the National Development and Reform Commission, according to Xinhua.

In Mongolia, the preliminary plan is to build three power plants with an installed capacity of 3.6GW each. The first plant will begin operation by 2010. Most of the supply will go to Beijing, Tianjin and Hebei , while only a small part will serve Mongolia.

The State Grid Corp will build the transmission lines, while the construction of the plants may be carried out by Mongolian companies. The project in Kazakhstan will follow a similar pattern, while the power plants in Russia will be built by Russia.

Tang Ming, a chief economist with the Asian Development Bank, said it was natural for companies to seek cheaper resources globally.

When asked if China was moving its pollution problem to its neighbours, Mr Tang said the phenomenon was decided by 'the different development stage each country is at'.

'Every country has different requirements in environmental protection. In the three nations, the requirements are not as high as in developed countries,' he said.

Tsinghua University professor Li Dun warned that moving a pollution source from one nation to another did not help reduce the problem.

'If the companies consider costs globally, they should consider the environment globally too. It's like vowing not to cut domestic trees while cutting trees from other places. This is definitely not how a responsible company acts,' Professor Li said.