China Unveils Plan for Power Sector Regrouping

Home>>Business

Last updated at: (Beijing Time) Wednesday, October 23, 2002

China Unveils Plan for Power Sector Regrouping

DISCUSSION

CHINESE

SEND TO FRIEND

The nation's work team working for a restructuring of the power sector has submitted a reform plan to the State Development Planning Commission on October 15 for approval by the State Council, which involves setting up a national power regulatory committee, two power grid corporations and five independent power generation groups, namely, Datang Power Generation Co,. Ltd, Shandong International Power Development Co,.Ltd, State Power, China Power International and Huaneng Power International Inc.

The Chinese government has informed state-owned power companies the regrouping plan, which is hopefully to be completed before the end of 2002, media reported recently.

Preporatory team widely concerned

Zhai Ruoyu, chairman of Datang and general manager of North China Power Corporation as reported will head a preparatory team of a national independent generation company along with Datang's property. Meanwhile, deputy general manager of State Power He Gong will lead the work to set up a company which includes property of Shandong International Power Development Company. While the news saying former governor of Zhejiang Province Chai Songyue going to take on the work to set up the national regulatory committee is still to be proved.

This is just a temporary leading team and the leadership list has not yet been finalized, and the plans for posts, departments and staff are still under deliberation, official close to the reform said. Anyway, experts believed this marked an important step of a new round of the nation's power sector reform.

Five power groups to be established

The State Council approved a plan on April 10, in which the State Power is to be split into power generation and distribution companies and a regulatory committee be set up to encourage competition. While the plan submitted on October 15 provided details on the regrouping, that is, reform on power generation will, for the moment, only touch the property regrouping of State Power, thus establish five independent power groups of national level, as mentioned above.

Except for the Huaneng Group approved earlier, the remaining four groups will receive property from the former State Power and finally each have a capacity of 30-40 million kw, of which three have got listed.

Two power grid corporations divided

As for power grid reforms, the State Power Grid Corporation and the Southern Power Grid Corporation will be set up, with the former enjoying independent budgetary status.

The State Grid is responsible for setting up regional companies in China's north (including Shandong), northeast (including eastern Inner Mongolia), northwest, east (including Fujian) and central (including Chongqing and Sichuan) areas, with Tibetan companies under its acting management. While the Southern Grid will be a stock company covering areas as Yunnan, Guizhui, and Guangxi.

A new epoch for power industry

Morgan Stanley analyses are optimistic towards the prospect of China's independent power producers, and predicted that the year 2003 will see a new round of capital injection.

Although no essential change is expected from current power pricing, project application and approval during a short time, the nation's power sector is ushering in a new epoch along with the establishment of a regulatory committee, two power grids and five generation groups, expert said.

By PD Online Staff Li Heng

Questions?Comments? Click here

China to Speed Up Reform of Power Sector

Historic Achievements Gained in China's Science and Technology ( 18 Messages)

Powell Expects Improvement of US-China Relations ( 25 Messages)

China May Have More PhDs Than the US in 2010 ( 3 Messages)

China's Oil Security Faces Tests of War: News Analysis ( 23 Messages)

Economist on China's Sustainable Economic Growth ( 5 Messages)

President Jiang's Trip will Advance Sino-US Ties: Officials ( 6 Messages)