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The Current Power Industry Is Facing Major Problems
- Nov 23, 2017 -

1.The overall power supply industry oversupply, northeast, northwest power surplus further intensified. As China's economy has entered a "new normal," power demand growth has slowed down significantly. Due to the lack of co-ordinated guidance on power planning, the installed capacity of power supplies has maintained a rapid growth. As a result, power supply is greater than power demand in most parts of the country. In 2016, both the Northeast and Northwest Power Grids surged more than in 2015.

2.The new coal-fired power installed capacity in China maintained a relatively large scale, while the newly increased coal power in the eastern and central regions remained relatively large. In recent years, the motivation of power generation enterprises to invest is still high. In addition, some local governments require "steady growth" after the examination and approval authority is decentralized, and the new installed capacity of coal power still maintains a large scale and the layout is not reasonable. It is estimated that new coal-fired power generation installed capacity will reach 51 million kilowatts in 2016, of which about 13 million and 12 million kilowatts will be added to the eastern and central regions, respectively, which together account for about half of the total new installed capacity.

3.The rapid development of renewable energy in some areas, consumption problems have become increasingly prominent. In recent years, due to the imperfect operation mechanism, the slowdown of power demand growth, the insufficient resources for peak shaving of the system and the limited capacity of power transmission, the scale of waste water, abandoned wind and abandoned light in China continues to climb up. However, some areas that are difficult to absorb and dispose of, Still vigorously develop renewable energy. In the first half of the year, the nation's wind power generation dropped to 32.3 billion kilowatt hours, and the abandonment rate was 21%, up 6% over the same period of last year. Gansu, Xinjiang, Jilin, Inner Mongolia abandoned wind rate of more than 30%. In addition, the amount of abandoned water in the southwest region and abandoned light in the northwest region also increased.

4.Slow growth in electricity demand, power companies operating pressure to further increase. For power grid enterprises, due to the slow growth in electricity demand and the sluggish sales growth, the reform of the power system will aggravate the competition in the electricity sales market and make it difficult for enterprises to support the rapid growth of revenue and profits through electricity sales. For power generation enterprises, the utilization hours of thermal power equipment continued to drop, the on-grid electricity price was reduced, the price of coal rose, and the profitability of enterprises further contracted.