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Feeding our hunger for power
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MANY people have become familiar with the energy crisis looming in the US, but Shenzheners don't have to look so far abroad to find a power shortage -- there is already one right here at home. The Shenzhen Evening News, for example, recently published reports of power outages in Nanshan District. Most of the blackouts occurred in residential areas. Fruit venders, grocery stores and restaurants were also affected by the power cut. Surprisingly, it was business as usual despite the outage.
Asked whether the blackout affected his business, a fruit shop owner pointed to a gas lamp hanging on the wall and said: "You see, it's brighter than a bulb. And I had more customers than usual. Most people can't stay at home once the air conditioning goes off, so they just come out to walk around. Some patronize my shop."
A quick glance at the daily advance power outage notice on the Shenzhen Power Supply Bureau website reveals that most of the periodic power cuts have been limited to areas and entities that have the least effect on the city's economic development. So far, the bureau says no complaints have been received from either foreign or local investors and entrepreneurs.
Reversed situation
Shenzhen first balanced power supply and demand in 1995. But last year witnessed rapid growth in demand and also a decline from power sufficiency to deficiency. According to statistical forecasts, this year's total consumption of electricity could reach 20 billion kilowatt hours, and the peak load would be four million KW, a respective increase of 16 per cent and 18 per cent over last year.
"We are facing a grimmer situation than last year," said Wang Suiming, vice-mayor of SZ during a conference on power supply in the city.
To relieve its power supply pressure, the municipal government launched a new measure at the end of May stipulating different rates to be charged at different times of electricity consumption. The current rate remains unchanged during the peak period (from 7am to 11pm) but is reduced from 11pm to 7am. The pricing structure is designed to encourage consumers to use electricity at off-peak periods. The new policy only applies to industrial users. Civilian users remain unaffected.
Other measures taken to cope with the power shortage includes the city asking for the maximum possible supply from the provincial power grid. The city government has also asked SZ's power plants to unconditionally follow its orders regarding the amount of power they are to generate, even at the price of losing money at these plants, which will in turn be subsidized by the city government. And to cope with possible power cuts, zones and corporate entities have been listed in order of priority to receive maximum guarantees of power supply.
One source of the city's power is the Guangdong provincial grid. But since the province cannot have a significant increase in generation this year, more electricity is expected to be bought from Hong Kong.
In late April, at the same conference as mentioned above, Wang Suiming said: "We need to work hard and use every means to guarantee the power supply during the peak period this summer, so that our city's sustainable, rapid and healthy economy will have reliable energy supply."
The past
At the end of the 1980's, electricity was in severely short supply in SZ. Each week, many enterprises had four days with electricity and three days without it, and some even had to make do with just two days of power per week. Many foreign investors cried foul. Some of them even sent letters of complaint all the way through to the Central Government in Beijing. According the statistics, the city's enterprises equipped themselves with more than 6,000 diesel electricity generators, and power-cut emergency lights were installed in huge numbers.
To tackle the problem, the city worked out a Shenzhen Energy Development Plan in mid-1991 and started massive construction of power-generating facilities.
Funding was key to the construction. And that is what the city first worked with. So, as a pioneer in the country in so many areas, SZ liberalized its electricity market, which enabled the power plants to make higher profits than other industrial entities. For the first time since the founding of the People's Republic, electricity became a commodity.
The new policy soon generated 10 billion yuan in construction funds and expedited the building of power plants. In 1993, 12 fuel-consuming power plants were completed, with a total installed capacity of 940,000 KW. The next year saw two more generating units of 300,000 KW each enter service. And in next two years, another two units of 300,000 KW each were added to the city's power grid.
With all this construction, between 1995 and 1999, SZ's power supply slightly surpassed demand.
Why the change
The year 2000 saw the fastest growth in power demand since 1995. Three causes are attributed to the reversal: rapid economic growth, more demand from rural areas and high oil prices in the international market.
In the first quarter of this year, the city's gross domestic product went up by 10.8 per cent, compared to the same period of last year. At the same time, its maximum electricity load and power supply increased respectively by 20.98 per cent and 13.9 per cent.
With the "two reforms and same price" policy - reformation of the power grid and power management system in the country's rural areas and evening up the electricity prices in the cities and countryside - regarding China's rural power consumption, the city's rural areas increased their power consumption by 46 per cent last year.
And as for the third cause, soaring oil prices in the same year helped shrink the amount of electricity the city's power plants generated to more than a quarter less than a normal year.
Improvement
Both Guangdong Province and Shenzhen have kept working to provide more electricity to SZ.
There is some good news: a reformed power station of 300,000 KW will be added to the current power grid in the second half of the year. And some old power plants that have been closed for years will be taken out of mothballs and fired up again.
At the end of May, SZ had a sudden increase of 25 per cent of power supply from Guangzhou, the capital city of Guangdong Province, because the reformation of a 220 KV transmission system was completed. This will go a long way to helping SZ fight its power supply problems.
The city is also encouraging enterprises to use their available diesel generators so as to lighten the burden on the provincial grid. At the same time, interest-free loans will be provided to the enterprises to purchase energy-efficient machinery and technical know-how.
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