China needs to ‘ensure a smooth switch’ amid rising demand for natural gas
- Boss of main supplier in Beijing expects 14 per cent more of the clean-burning fuel to be consumed this year than in 2018
- Li Yalan says efforts to better connect end users with suppliers are needed
China’s surging natural gas demand in 2019 will require more efforts to better connect end users to suppliers as government policies and a recent tax cut will continue to spur consumption of the clean-burning fuel, a senior industry executive said.
China’s gas demand will expand by 30 billion to 40 billion cubic metres (bcm) this year, Li Yalan, chairwoman of Beijing Gas Group, the main supplier to the Chinese capital, said in an interview on Friday.
That would be an increase of as much as 14 per cent from the 280.3 bcm of gas China consumed in 2018, according to data from state economic planner the National Development and Reform Commission (NDRC). Gas consumption in 2018 was 18 per cent higher than in 2017, the NDRC said.
The rising gas demand is a result of China’s government continuing policies to switch to gas from coal for heating and industrial uses and as the industrial sector buys more gas following cuts in the value-added tax that went into effect on April 1, she said.
“The broad direction is not going to change, which is to restructure the energy mix by increasing the share of natural gas,” Li said. “What China needs to do is to connect the gas supplies with the demand nicely to ensure a smooth switch.”
Better state planning to ensure grid connections and to encourage energy companies to boost imports in advance helped China’s gas market, the world’s third largest, to expand by a record 43 bcm last year, Li said.