China’s Electricity Demand to Double by 2026

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By Joao Peixe of Oilprice.com

Over the past decade China has experienced huge economic growth, with a yearly growth rate in double figures, and this has required an equally huge growth in capacity of its energy generation industry. The amazing thing is that the potential economic slowdown that China now faces doesn’t look set to impact on the trend for increasing energy generation capacity.

IHS has released a report claiming that China’s electricity demand will double by 2026, and that by 2035 it will be more than the demand of the US and Europe combined.


Back in 2010 Beijing set a five year plan to increase the total installed power capacity across the country by 54%, from initial levels of 1,490 GW. Over the past decade alone China has managed to triple its electricity infrastructure capacity, adding an average 80GW of new power every year; or to put it another way, a grid the size of Japan’s, the third largest in the world, every four years.

Despite the fears of a coming slowdown in economic growth, the energy sector is still expected to expand by 4.1 percent a year over the next twenty years, just a third the rate over the past decade, but still an impressive achievement considering the size of the China’s installed capacity.

So far much of China’s new capacity has been from coal power plants, but in the future natural gas is will contribute the largest share of new installations, with capacity expected to increase by 1,000% by 2035, at which point China will match the US as the top natural gas consumer in the world. Currently natural gas only accounts for 5% of China’s total power generation.

The IHS report warns that “future Chinese gas consumption depends greatly on how much -- and at what cost -- shale materializes.”

Energy analysts at Barclays (BCS) suggested that “ambitious unconventional gas agendas aimed at improving energy security and pollution concerns should drive spending for the remainder of the decade.”



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.




This article appears in: Investing , Commodities , International , Technology

Referenced Stocks: BCS

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