China power crunch seen worsening-think tank

BEIJING, May 30 (Reuters)

Power outages in fast-growing China are seen increasing in frequency this year compared with 2003 as tight energy supplies fail to keep pace with increasing demand, state media said on Sunday.

"China will face a more serious situation in terms of power supply this year compared to 2003," a report by the State Information Centre, a top government think tank, said.

"Brownouts will occur in more areas this year," the report said, according to Chinese newspapers.

China, the world's second-largest power user, suffered brownouts -- managed, limited power cuts -- across three quarters of its 31 provinces and regions in the first three months of this year, and factories across the nation have been bracing for another summer of disruptive outages.

Brownouts hit more than half of China's provinces last summer, as surging demand overwhelmed its fragmented grid system.

The State Information Centre said total power consumption was expected to hit 2.09 trillion kilowatt hours this year, an increase of 11 percent over 2003.

China's huge appetite for energy helped push world oil prices to 21-year highs in recent months, and the power crunch was not seen easing until next year, the Beijing Daily said.

Power consumption was expected to reach 4.5 trillion kilowatt hours by 2020 while China's installed capacity was seen hitting 9.5 trillion kilowatt by 2020, the Xinhua news agency quoted domestic power grid monopoly State Grid Corp as saying.

China has seen three straight quarters of economic growth above nine percent, fanning worries that overheating in sectors such as property and steel could precipitate a hard landing if government measures to cool the economy fail.

 

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