China Plans To Cut Back On Small-scale Power Plants

China Plans to Cut Back on Small-Scale Power Plants

PlanetArk CHINA

30th November 2006

BEIJING - China plans to cut back on the small-scale generating units that account for nearly one-third of its coal-burning power capacity, state media reported on Wednesday.

The energy policy-setting National Development and Reform Commission has drawn up a set of proposals for scaling up the size of the country's coal-burning stations, the China Securities Journal said, citing senior officials.

They aim to address pollution, pricing and power management among other issues, and promote clean, efficient and renewable energy -- mostly by copying on a national scale policies already piloted in Guangdong and Henan provinces.

"The high proportion of small generating units is a key problem for the power industry and has become an important factor restricting its healthy development," the paper quoted NDRC energy bureau chief Zhao Xiaoping as saying.

Measures include subsidies for companies that shift to large generating units from smaller ones, and encouraging suitable smaller plants to shift to biomass fuel like straw.

China relies on coal for over 80 percent of its electricity and the jet-black fuel is likely to be the main energy source for the country's booming economy for decades.

But air pollution is becoming an increasing headache for leaders, with acid rain affecting one-third of the country and smog causing hundreds of thousands of early deaths a year and driving foreign workers from cities including Hong Kong.

As a result, Beijing is trying to build cleaner coal plants and encourage the development of renewable and alternative energy. The smaller units targeted for shutdown are often older, less efficient and more polluting than larger stations.

REUTERS NEWS SERVICE