Will new national energy agency be just another toothless body?

After more than two years of bureaucratic wrangling, the mainland leadership last week announced the establishment of the National Energy Commission (NEC). Energy analysts and some overseas media have been quick to hail the significance of the supra-ministry agency, which reflects the high priority of the energy issue because of the mainland's thirst for oil and coal to fuel its economic expansion.

According to a State Council notice last week, the commission will be headed by Premier Wen Jiabao with Executive Vice-Premier Li Keqiang as the deputy head. Its members include ministers of the mainland's 21 most powerful agencies. According to the mainland hierarchy, such a high-level make-up of the commission denotes serious power and broad policy purview.

Some overseas media has highlighted the unusual fact that the commission has included a deputy chief of staff from the People's Liberation Army, the minister of state security, and the foreign minister. So, it appears that the mainland leadership intends to seek better co-ordination and strong overview of the government's efforts to secure energy supplies abroad.

Despite its powerful status, serious questions remain over the effectiveness of the commission.

According to the State Council notice, the commission will draft energy development strategy, review energy security and co-ordinate international co-operation.

This is not the first time that the mainland leadership have attempted to create a powerful agency to oversee energy but the previous attempts have produced little. As part of the economic reforms, the mainland leadership abolished the ministry of energy in 1993 and created three national energy conglomerates, leaving the regulatory power to a dozen government ministries.

For instance, the energy pricing and approval for major energy projects are the purview of the National Development and Reform Commission, and the Ministry of Commerce is responsible for approving the Sino-foreign energy deals. In 2003 the NDRC set up an energy bureau seeking to consolidate power over energy policies but it remained largely toothless due to resistance from other government ministries.