China May Face Power Glut

An analysis by Michael Lelyveld

2013-01-21

Generating surplus may follow slower economic growth.

AFP
Steam rises from a power station in Beijing on Dec. 5, 2012.

As its economic growth slows and air quality declines, China may be building more power plants than it needs.

During 2012, China increased its generating capacity far more than its power consumption growth, according to official reports.

After years of power shortages, the trends suggest a major shift that could soon burden the electricity sector with generating surpluses and under-utilized power plants.

"There's a probability of it, almost a certainty of it," said Philip Andrews-Speed, principal fellow in the East Asia program at the National University of Singapore's Energy Studies Institute.

"The question is, is this a bad thing?" Andrews-Speed said.

Last year, China power production rose 4.5 percent, the State Electricity Regulatory Commission (SERC) reported. Power consumption grew 5.5 percent, far less than 11.7-percent rate in 2011, the National Energy Administration (NEA) said.

But installed generation capacity climbed 7.5 percent to at least 1,140 gigawatts (GW), according to the NEA. Previously released figures for 2011 suggest growth was actually over 8 percent.

The numbers mean that China is adding power plants at a rate 77 percent faster than it is using them and 45 percent faster than growth in demand.

The gap is the result of last year's slower economic growth in the midst of a longer-term buildup of capacity, which was designed to keep pace with double-digit growth rates.

Capacity

China nearly doubled its generating capacity between 2005 and 2010, making plans to double it again by 2020. Under the 12th Five-Year Plan, China's installed capacity would reach 1,400 GW, implying continued annual growth of about 8 percent.

If the government sticks to that track and slower economic growth persists, overcapacity in the power sector seems set to expand.

Last year, China's gross domestic product—the main measure of a country's economic activity and growth—rose 7.8 percent, the National Bureau of Statistics (NBS) reported. The rate fell far short of 9.3-percent pace in 2011 and the 10.4-percent growth of 2010.

Experts cited by the official Xinhua news agency expect lower growth in power demand to become the norm.

"A deceleration in electricity consumption is an inevitable trend in the future, as China has vowed to
optimize and upgrade its industrial structures in the 12th Five-Year Plan," said Zhang Zhibin, an analyst with Broad Consultancy Agencies.

Lag behind

Zhang predicts power consumption growth of about 6.5 percent this year, which would still lag behind the planned increase in generating capacity.

Electricity surpluses were last seen as a problem in 1998-2002, when the Asia currency crisis slowed China's economy, prompting the government to halt power projects, Andrews-Speed said.

So far, there is no sign that the government plans to do so again.

Starting in 2003, faster economic growth began to give China the opposite problem with power shortages that forced cuts in service and drove factories to run diesel generators.

But despite warnings, major power shortages have largely failed to materialize since 2010, while capacity expansion rates have stayed about the same.

Andrews-Speed said a moderate surplus would not necessarily be a problem.

"If you have overcapacity of 10 percent or so, then you're more able to deal with crises of different types," he said.

Drought has been a periodic problem for hydro-electricity production, for example. Hydropower accounts for 21.8 percent of China's generating capacity, according to the NEA.

Reforms

Surplus capacity could also help if the government is serious about promoting reforms in the power industry.

"If they wish to go ahead and start to introduce some form of real competition in the power sector, then you need excess capacity. If you don't have excess capacity, you can't have competition," said Andrews-Speed.

But the problems with overcapacity may be under-utilization of power plants by dispatch centers and insufficient return on investment.

"Some power companies are going to find themselves losing money," Andrews-Speed said. "They're going to find that some power stations are not dispatched, or they're going to have to sell at a lower price."

For years, China five big state-owned power companies have reported heavy losses on thermal generating, mostly from high-polluting coal, as a result of government-controlled electricity rates.

But overcapacity could turn the tables on the situation, since the risk of losses may be because rates are too high rather than too low.

Instead of scrambling for power wherever they can get it, regulators may be called upon to choose which electricity supplies to dispatch into China's grids.

Decisions could be based on price, environmental impact or local political interests.

Choices

Whatever the criteria, capacity surpluses may present the government with choices it has not had to deal with in years.

"It's an interesting moment," Andrews-Speed said. "The government will have to make decisions either to reinforce the administrative measures or to move toward more economic dispatch."

Last week, SERC predicted that power consumption will pick up this year, reaching 9-percent growth. But that pace would still be slower than the 2011 rate.

SERC cited a strong 10.7-percent increase in household electricity use last year. But consumption in the industrial sector rose only 3.9 percent, the NEA said.

Breaking: Tibet continues to burn, Second self-immolation in the new year

DHARAMSHALA, January 18: The wave of self-immolation protests in Tibet against China’s continued occupation of Tibet shows no sign of abating with reports just in of yet another fiery death in Khyungchu region of Ngaba in eastern Tibet.

Initial reports have identified the Tibetan self-immolator as Tsering Phuntsok. According to a Swiss based Tibetan, Sonam, the protest occurred at around 3:15 pm (local time).

“Tsering Phuntsok set himself on fire in front of the local Chinese police station in Drachen village of Khyungchu region,” Sonam told Phayul. “He passed away at the site of his protest.”

Chinese security personnel arrived at the scene and bundled away Tsering Phuntsok’s body to Barkham, the same source said.

Tsering Phuntsok is survived by his wife and two children.

Photos of today’s self-immolation protests show the charred body of Tsering Phuntsok, still on fire, lying on the ground. A number of people could be seen surrounding the body.

Reports suggest that monks of the Amchok Monastery are currently carrying out a prayer service for the deceased.

This is the second self-immolation protest in Tibet since the beginning of the new year. In 2012 alone, as many as 82 Tibetans set themselves on fire demanding freedom and the return of Tibetan spiritual leader His Holiness the Dalai Lama from exile.

Chinese authorities in the region have intensified their repressive policies by criminalising the self-immolation protests, arresting family members and friends of protesters and off late, confiscating thousands of satellite TV dishes aimed at creating an information black hole in the region.

“Tibet is getting into the global evening news because of self-immolations and so there’s this anxiety to bring it under control,” Michael Davis, a law professor and Tibet expert at the University of Hong Kong told AP. He warned that the new leadership “will be particularly anxious not to have any of these problems blow up in their face.”

“I think self-immolations and all of this suggest that they are not winning the hearts and minds of the Tibetan people and in fact the more repressive they are, the more resistance they encounter, so it’s a kind of vicious circle,” Davis said.

China appoints Wei Wei as new ambassador to India

DHARAMSHALA, January 17: China has appointed career diplomat Wei Wei, 57, as the country’s new ambassador to India, replacing Zhang Yan.

Wei, who holds a master’s degree in law according to his official biography, earlier served as the Ambassador to Singapore since 2010. He has extensive experience in Africa, formerly serving as China’s Ambassador to Brunei, and as a senior diplomat in Embassies in Ethiopia, Kenya, and Zimbabwe.

Wei takes charge amid a sweeping once-in-ten year leadership change in the Chinese government, with the Communist Party’s fifth generation of leadership asserting control – a transition that culminate in March with the recently-selected general secretary Xi Jinping replacing Hu Jintao as President.

Wei’s tenure in New Delhi has been preceded by warming-up of relations between India and China. The two countries, earlier this week, agreed to resume their joint military exercises and expand their exchanges to include Armies, Navies, and Air Forces during the fifth Annual Defence Dialogue held in Beijing. Defence ties between the two Asian giants were earlier suspended for almost a year after China refused to issue a visa to the then head of the Indian Northern Command.

Also recently, Xi Jinping in a letter had assured Prime Minister Manmohan Singh that his country would pay "great importance" to developing bilateral ties as their cooperation has brought "substantial benefits" to both sides.

"China will, as it has been doing, pay great importance to developing relations with India and expects to carry out close cooperation with India to create a brighter future of their bilateral relations," Xi wrote in a letter to Singh last week.

Former ambassador Zhang Yan, who served for four years in India, has been appointed as the 6th Executive Director of the Asia-Europe Foundation.

China's claim over Arunachal Pradesh to counter India on Dalai Lama: Pema Jungney

KOLKATA: China's claim over Arunachal Pradesh is a tool to counter India's support to the Dalai Lama and the Tibetan cause, former speaker of Tibetan parliament-in-exile, Pema Jungney, has said.

"It is the strategic policy of China to stop India from supporting our cause. They use their unethical claim over Aksai Chin, Pakistan's claim over Jammu and Kashmir and Arunachal Pradesh as a tool to counter India's support to the cause of free Tibet and the Dalai Lama," he said here.

"The issues of J and K, Arunachal Pradesh and Tibet are totally different. J and K and Arunachal are integral parts of India. But Tibet was a free country till the late 1950s," he said.

Claiming that 95 Tibetans have immolated themselves in protest against Chinese rule in Tibet, Jungney said protests against Chinese rule would continue as long as autonomous status was not obtained.

He said only an independent investigation by the UN could bring out the condition of human rights in Tibet.

"In Tibet the condition of human rights is very bad. We have been making appeals in the international forum for the last several decades. We want an independent investigation into the condition of human rights in Tibet by the UN. Only then the real picture will come out," said Jungney, who is the longest serving MP of Tibetan parliament-in-exile since 1988.

"We want to talk to the new Chinese regime. But they are not at all interested in talking to us. We want an autonomous status, where education, health, industry will be controlled by Tibetans and defence, international affairs will be controlled by China," he said.

Thanking India for its continuous support to the cause of Tibet, Jungney sought India's help to the Tibetan parliament-in-exile to formulate world opinion on Tibet.

"In Tibet no foreign press is allowed. They have blocked all satellite and communication systems so that no news reaches the outside world," he said.

The members of Tibetan parliament-in-exile are on a tour to meet Indian political leaders to sensitise them about Tibet.

The Dalai Lama and top scientists gather in Mundgod for Mind and Life conference

DHARAMSHALA, January 16: Tibetan spiritual leader His Holiness the Dalai Lama is scheduled to take part in extensive discussions beginning tomorrow with some of the world’s top scientists and philosophers on topics ranging from quantum physics to neuroscience to Buddhist and Western understanding of consciousness.

The Dalai Lama arrived in south India today from New Delhi to take part in the Mind and Life XXVI: Mind, Brain and Matter - Critical Conversations Between Buddhist Thought and Science to be held from January 17-22 at the Drepung Loseling Monastic University in Mundgod Tibetan settlement, Karnataka state.

The six-day event will bring together 20 of the world’s foremost scientists and philosophers with His Holiness and other senior Tibetan scholars in the attendance of several thousand monks and nuns from numerous Tibetan monastic centers of learning.

According to the organisers, the conference will engage in important questions of mutual interest and challenge such as the fundamental nature of our physical world, the problem of consciousness, the nature and workings of our mind, and the interface of contemplative practice and scientific research.

With two sessions each day, scientific and the classical Buddhist philosophical methods of inquiry will be studied, in addition to selected topics in quantum physics, neuroscience, and Buddhist and contemporary Western views of consciousness.

The conference also aims to offer an educational forum, whereby the monastic students can learn about the historical development of science, and how science has come to shape the way we understand our world.

Science studies have been very recently introduced in the highest examinations conducted by the Gelukpa University.

Monks studying in the final four years of the regular monastic study programme and the first two years of the Geshe Lharampa degree curriculum, which is equivalent to doctorate of Philosophy, are now be required to appear for science examinations over a spread of six years, beginning 2014.

The conference is being jointly organised by Mind and Life Institute, Emory-Tibet Science Initiative, and the Library of Tibetan Works and Archives.

Live Webcasts of the conference from January 17-22 from 9 am - 11:30 am IST and 1 pm - 3:30pm IST will be available here.

UP Minister writes to the Dalai Lama, Pledges to raise Tibet

DHARAMSHALA, January 15: A senior minister in India’s most populous state, Uttar Pradesh, has pledged to raise the issue of Tibet in the Indian Parliament.

Shivpal Singh Yadav, Minister of Public Works Department, made the pledge in a letter addressed to the Tibetan spiritual leader His Holiness the Dalai Lama, which he issued to a visiting Tibetan parliamentary delegation in the state capital Lucknow.

In the letter, the senior leader of the ruling Samajwadi Party has expressed his support to the Tibetan cause, objected China’s failed policies in Tibet, and vowed to raise the Tibetan issue in the Indian Parliament.

The north zone Tibetan parliamentary delegation, after successfully lobbying with Indian leaders and leading awareness campaigns in the northern states of Jammu and Kashmir, Himachal Pradesh, and Uttranchal, met with several leaders across party lines in Uttar Pradesh.

Pushing for international intervention in the ongoing crisis in Tibet, the Tibetan delegation met with leaders of the Bharatiya Janata Party, Bahujan Samaj Party, and Congress Party. According to the delegation members, Indian leaders across the spectrum expressed their solidarity and support for Tibet.

Speaking to reporters in Lucknow, MP Dawa Tsering said, “We have got support from the Samajwadi Party in Uttar Pradesh and even assurances from the ruling party in other states. We hope to get support from the entire nation that has helped us keep out culture and tradition alive.”

Tibetans in Lucknow staging a public protest as part of the parliamentary lobbying campaign.

As part of the campaign, around fifty Indians, including state officials, intellectuals, historians, and social servants took part in a discussion on Tibet over the weekend.

The discussion concluded with a pledge of not using 'Made in China' products until the Chinese government resolves the crisis in Tibet, provides basic human rights to Tibetans in Tibet and returns to India land grabbed by invading Chinese forces during the 1962 border war.

The lobbying campaign in Uttar Pradesh concluded with a public rally by local Tibetans in the capital city.

The Tibetan parliamentary delegation will now take their campaign to the Indian state of Bihar.

The Dharamshala based Tibetan Parliament-in-Exile launched the month long all-India lobbying campaign aimed at garnering wider support for international intervention in the ongoing crisis inside Tibet.

Three Tibetan parliamentary delegations are currently on a nation-wide lobbying campaign, meeting Indian leaders and the public, apprising them on the ongoing wave of self-immolations in Tibet, which continued into the new year with the fiery death of a Tibetan youth, Tsering Tashi, on January 12 in eastern Tibet. The self-immolators have demanded freedom and the return of the exiled Tibetan spiritual leader His Holiness the Dalai Lama.

Four-day discourse by The Dalai Lama ends

VARANASI: The four-day discourse on 'Bodhicharyavtar' delivered by the Tibetan spiritual leader, The Dalai Lama, at the Central University of Tibetan Studies, Sarnath ended on Thursday. Besides the local students and Buddhist monks from far off places, the students and foreign delegates from various other universities and colleges were also present on the occasion.

The Dalai Lama arrived on January 6. He delivered discourses from January 7 to 10. He also gave 'diksha' on Thursday. He will address the staff and students of CUTS on Friday and meet with a special foreign delegation on January 12. Before leaving for New Delhi he will inaugurate the three-day international conference of Asian Buddhist Forum on 'Buddhism and Society'.