High-voltage solutions needed for central China

Central China is facing power shortages as it attempts to lure investors and manufacturers to shift capital and factories there from the eastern coast.

The central China grid will consume 9.5 percent more electricity year-on-year to 842.3 billion kilowatt hours (kWh) in 2012, according to the Central China Grid Company, which powers the five provinces of Hubei, Hunan, Henan, Jiangxi and Sichuan, and the megalopolis of Chongqing.

Despite being less than the 14.9 percent rise last year, the growth rate this year is still above the national average, said the company.

Maximum electrical load in the region will surge 11.5 percent to 139 gigawatts this year, with peak power shortfalls predicted to total 9 GW in summer and 12 GW in winter.

The expected shortages will hurt thousands of industrial users, but they are no strangers to power rationing. The company said it restricted power consumption on 233 days last year, up from 55 days in 2010.

For the first time in history, the central China grid is facing more supply constraints than the east China grid, China Power News has reported, citing a February power conference at the National Development and Reform Commission, the country's top economic planner.

"Power shortages are becoming worse in central China due to strong economic growth and the lack of coal, oil and natural gas," said Xie Mingliang, the company's general manager.

Chongqing's economy grew 16.4 percent last year, the fastest in the country, and is forecast to rise 15.5 percent this year. Hubei led the four provinces fed by the central China grid with a 13.8-percent rise last year, and its economy is set to double over the next five years.

"After years of explosive growth, the power supply situation will deteriorate to such an extent that Hubei alone may face a deficit of about 10 GW in peak hours in 2015," Xie warned.

POWER DILEMMA

"The central China grid is in a no-win situation. To put it in a nutshell, we are rich in hydropower but we have to give it away to the more developed coastal regions. And it's never easy for us to get coal -- which we don't have -- from outside," said a grid company official, who spoke on condition of anonymity because he was not authorized to speak to media.

Fossil fuels, which supply roughly 90 percent of China's energy, are scarce in the central provinces apart from Henan. Supply in the region is further threatened because Henan, which normally supplies coal to neighboring provinces, is itself short of power.

Without coal, thermal power generators with a total capacity of 8 GW were forced to shut down at the same time last year in central China. Furthermore, poor-quality coal left nearly 12 GW of coal-fired generating capacity underutilized.

The power-hungry provinces have long had to beg Shanxi in north China for coal, and to plead with the railway bureau there to deploy more freight trains.

But because of inadequate rail transport capacity, last year about 10 million tonnes of coal went on a month-long detour of thousands of kilometers to get to Hunan and Hubei, traveling first by rail eastward to Qinhuangdao Port, then by sea southward to the mouth of the Yangtze River, and finally it was taken up the river.

As coal prices remain high and on-grid tariffs are relatively low, thermal firms' losses are mounting and the cash flow problems have in turn affected power generation. Among major thermal firms covered by the central China grid, only six in Henan, one in Hubei and one in Hunan made profits last year.

Although central China has 181 GW of power generating capacity, of which hydropower accounts for 41 percent, much of the hydropower is siphoned off by the major regional economies in the east and south.

Hubei, home to the Three Gorges Project, can use only 15 percent of the power from the world's largest hydropower station, said Yin Zhengmin, general manger of Hubei Electric Power Corp, adding that recurrent droughts and low hydro levels have added to the power woes.

Xiangjiaba and Xiluodu, two hydro projects along the upstream portion of the Yangtze River, will also see most of the electricity go to the east after operations start in 2012 and 2013. The two stations combined are as large as the Three Gorges power project.

POWER SUPERHIGHWAYS AND NUCLEAR PLANT

State Grid Corp. of China, the country's grid operator in 26 of 31 mainland provinces, has plans to build the world's first ultra-high voltage power transmission network to boost inter-regional transmission, as an alternative to rail transport. But it is still awaiting approval from the central government.

Power lines of 1,000-kilovolt (kV) alternating and 800-kV direct current can carry power thousands of kilometers from the landlocked north and northwest to major urban load centers in the east, south and central China, experts said.

China's first 1,000-kV alternating current transmission line has carried more than 8 billion kWh of power from Shanxi to Hubei since commercial operations began in 2006, Yin said.

Despite an expanded transmission capacity of 5 GW, the Jindongnan-Nanyang-Jingmen project cannot meet the soaring demand in central China, and should be extended further north to Inner Mongolia, China's top coal producer, he said.

In 2010, Hubei signed a cooperation pact with Inner Mongolia to receive 20 billion kWh of electricity annually by 2015 from the vast northern region. But without an extension of the line, the pact is redundant.

Xie said he hoped the central government would soon approve plans to build more ultra-high voltage lines to enable the region covered by the central China grid to use power from Xinjiang and Inner Mongolia, as well as from hydropower-abundant Sichuan where a series of gigantic power stations are being built.

"Begging for coal from outside is not a permanent solution. Only by building our own nuclear power plant and developing solar and wind power can we really have a say in energy," said Xiao Hongjiang, president of Hubei Energy Group Company.

The company has a 40-percent share of China's first inland nuclear power plant in Xianning city, with a planned capacity of 5 GW.

"The preparatory work has finished. We will go on to construct the plant once the government gives the green light," he said.

But Yin also pointed out that, because of the nuclear crisis in Japan, the government will tread warily before approving plans to build nuclear power plants in populous inland regions.