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| Part One Macro Environment for Foreign Investment in Shanghai |
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4. Resources
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4.3 Energy Supply |
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| 4.3.1 Present Situation of Energy
From 2000, the annual growth of energy consumption in Shanghai is 7.8%. In 2005, it was equivalent to 80 million tons of standard coal. The annual growth of electricity consumption in Shanghai is 10.5%. In 2005, it was 92.2 billion kw/h. The annual growth of natural gas consumption is 48.2%. In 2005, it reached 1.86 billion m3.
Shanghai finalized a number of important energy projects including the Phase 2 of Wai Gao Qiao Power Plant and the framework of the city power supply. In July 2003, the Three Gorges Project successfully began to supply electricity to Shanghai. In January 2004, the west gas reached Shanghai, which formed a double-source supply together with gas from East China Sea. The distribution network of natural gas has taken shape.
In recent years, by taking measures of limiting coal consumption, the percentage of coal in the energy consumption gradually dropped. Natural gas was introduced. The development of new energies, such as solar power, wind power and hydrogen have made significant progress. Shanghai’s energy supplies are diversified. The re-adjustment of energy structure has achieved positive results and the air quality distinctly improved.
By accelerating the adjustment of industrial structure, Shanghai endeavors to develop high-tech and high value-added industries with low energy consumption. More money will be invested in energy efficiency, and supervision and administration will be strengthened. The average energy consumption dropped year by year in the “10thFive Year”. |
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4.3.2 Electricity
In the “10thFive Year”, the electricity demand was growing very fast with an annual rate of over 10%, even as high as 13% since 2003. From 2003 to 2005, there existed, in different degree, electricity shortage in peak hours. From the fall of 2005, this shortage that lasted 3 years has been solved.
In the “11thFive Year”, Shanghai will accelerate the construction of key projects such as Phase 3 Of Wai Gao Qiao Power Plant, and will construct coal and power base in Anhui province and source more hydro-power from Southwest. At the same time, we are to improve major power lines and urban power grid. The power supply in East China is relatively easing up, favorable to Shanghai for sourcing more power.
In the summer of 2006, our local power generation capacity is 14,000 mega watts. By the end of 2005, a power transmission line from Shanghai to Taichang was built up, which adds extra capacity for Shanghai to source outside electricity. In 2006, the peak sourcing capacity will be 6.500 mega watts, 820 mega watts higher than 2005. Besides, wind power and solar power have been initiated. The first wind generators can produce 24.2mega watts.
After 2006, the growth of power demand will slow down to 9% every year. In the “11thFive Year”, the power supply and demand will keep balance. However, temporary shortage will occur when weather turns really bad.
The power demand in Shanghai is very much relevant to temperature. In summer, air conditioners consume 40%-45% of the total power. Meanwhile, on Saturday, Sunday and at night, the power is surplus. Shanghai will carry out well-planned power distribution by shifting weekends and holidays. The administration of power demand will be strengthened according to international practice and by way of administrative, economic, technology and market measures. |
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4.3.3 Natural Gas
For the time being, the natural gas supply can’t meet the industrial demand. With economic development, energy restructuring and consumption, the demand for natural gas will keep growing rapidly. Therefore, on the basis of “West-to-East Gas” and gas from East China Sea, Shanghai will accelerate LNG construction. Phase I will import 3 million tons, which will be completed in the “11th Five Year”. As a result, together with the West gas and East China Sea gas, a triple-source gas supply will be formed to guarantee gas supply for the city.
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4.3.4 Target of Energy Development
Shanghai applies strategy of safety-oriented operating energy saving as the priority, environment protection, and innovation. We are going to shape a multi-supply, safe, clean and efficient energy supply and consumption system.
Multi-supply: Well utilize, both international and domestic resources and markets, achieve multiple energy supply. Tap the potential of energy companies and insist on diversified suppliers. We will diversify energy supplies to minimize dependence on a single energy.
Safety: Establish a sound energy security system. Efforts will be made to improve backup capacity of power generators and reservation capacity of energy resources such as natural gas, petroleum and coal, so as to handle market fluctuation and emergencies.
Clean: Clean coal will be encouraged and desulfuration facilities will be installed in all power plants. We will actively expand the use of outsourcing power, natural gas and recyclable energy and increase their consumption in the total energy consumption.
High efficiency: Further raise the energy efficiency, and cut the energy consumption per unit by 20% in 2010 compared with 2005. |
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4.3.5 The Full Use of Resources
Shanghai will improve efficient use of resources, reduce waste discharge and set up a healthy and economic energy consumption mode.
(1) Strengthen savings of land, energy, water and raw materials. Shanghai will strengthen control and administration of land resources; strictly limit the land for projects in unencouraged categories. All key infrastructures will be well planned and comprehensive development of underground space will be accelerated. We will strictly limit projects of high energy consumption, low output and heavy pollution. New building should reach the energy saving requirement of 50% by national policies. Up to 2010, the water consumption per 10,000 GDP will drop 16% compared with the end of “10thFive Year”.
(2) Promote Clean Production and Comprehensive Use of Resources
All enterprises in municipal-level industrial zones and 6 main industrial bases will realize clean production. Industries such as petrochemical metallurgy, textile and pharmacy will apply clean production experiments. Ecological and sustainable agriculture is encouraged.
(3) Form Mechanism and technical support favorable to the development of recyclable economy.
New technology, new equipment and new materials are encouraged to save resources. Set up evaluation system on land usage, energy consumption, water consumption and pollution. Tax and policy incentives will be applied to encourage energy saving and comprehensive use. A number of leading companies and industrial zones will be introduced for sustainable economy. |
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