Thirty new projects will help solve the looming electricity shortage problem
Prosperity needs fuel and, to fuel its economic boom, China's electric power needs are enormous.
However, the situation was quite the reverse in the late 1990s. China's electric power industry experienced a serious oversupply then, due largely to demand reductions from closures of inefficient state-owned industrial units, which were major consumers of electricity.
The Chinese government responded to the short-term oversupply in part by implementing a drive to close down small thermal power plants and by imposing a freeze (with a few exceptions) on the construction of new power plants. This was put into effect last January.
Until recently, the backlog of projects approved in the mid-1990s had kept pace with demand increases. With a power shortage looming, the Chinese government in the first half of last year approved 30 new major electric power projects, with a total of about 22 gigawatts (GW) of capacity. Construction has begun on 17 of these projects. A total of 18.5 GW of new capacity is scheduled to be completed this year.
According to an independent report by the Energy Information Administration (EIA) of the United States government, the largest project under construction, by far, is the Three Gorges Dam. When fully completed in 2009, it will include 26 separate 700 megawatt (MW) generators, for a total of 18.2 GW.