Page 200 - 2017 White Paper
P. 200
7 White Paper on the Business Environment in China
commensurate air quality improvements are achieved” as PowerChina – said exports of indigenous technologies
(Wagner 2013). are to be a “key thrust” in the nation’s 13th Five-Year Plan
(2016-20), with the total scale of nuclear power generation
Natural Gas Price Liberalization from reactors both under construction and in operation
in the country reaching 88 gigawatts by the end of 2020.
In what is being referred to as “a major step” in the Though it is only a draft proposal, the State-owned firm
country’s reform to marketize energy prices, Beijing said it will “set the tone during the annual legislative and
in November 2015 cut mainland China’s natural gas political advisory sessions in 2016”. Nuclear is set to be one
wholesale price by an average 28% and announced that of the major beneficiaries of China’s embarking on a clean
it was giving up much of its control over price setting. energy drive to reduce emissions; at the same time, China
Benchmark non-residential gas prices at city gates, where is also looking to popularize its homegrown pressurized-
ownership transfers from producers to distributors, water nuclear technology known as Hualong One both at
were slashed by 0.7 yuan per cubic meter starting on home and abroad. China National Nuclear Corp chairman
November 20th. A statement from the National Reform Sun Qin said: “Third-generation nuclear technology meets
and Development Commission read: “Since the nation last the highest requirements for global safety standards and
[adjusted prices] on April 1st, gas demand and supply both has a competitive edge over others in terms of economic
in and outside the nation has changed markedly…the performance and reliability” (Chang 2015).
nation has decided to take advantage of this opportunity
to sharply lower non-residential prices and further push A forecast from the China Association of Automobile
forward price liberalization” (Ng 2015). Manufacturers (CAAM) sees China’s electric car market
surpassing the US to rank first worldwide, with car sales
Aside from cutting prices, the NDRC said it would allow expected to reach 220,000 to 250,000 for 2015. Deputy
buyers and sellers negotiate and set their prices from secretary-general Xu Yanhua of CAAM said worldwide
November 20th next year, as long as they agree on prices electric car sales will hit 600,000 and the figure for the US
no more than 20% above or below the benchmark prices. market is estimated to be 180,000: “Although China has
Due to low international prices, with both crude oil and achieved rapid development of the industry”, Xu told an
natural gas prices having fallen by more than half since industry conference, “quality instead of quantity should
mid-last year due to a rising supply, the commission said be focused on for the sustainable development of the
traders will only be allowed to set prices at or up to 20% industry”. In particular, Xu emphasized vehicle safety and
below the benchmarks between November 20th this year the careful examination/supervision of battery quality. In
and the year after that (Ng 2015). part thanks to extensive government subsidies and tax
cuts, China’s new energy vehicle sector has seen explosive
Focus on Clean Energy growth over the past two years: According to data provided
by CAAM, the first ten months of the year saw sales of
In early December 2015, the State Council announced electric cars surging 290% year-on-year to 171,145. China’s
their goal to upgrade coal-fired power plants to cut government is likely focusing on improving infrastructure
pollutant discharge by 60% before 2020, saving around and technology to promote sales of alternative-energy
100 million tons of raw coal and reducing carbon dioxide vehicles in its 13th Five-Year Plan (2016-2020): It has made
emissions by 180 million tons annually. According to the the development of EVs a strategic initiative as part of
statement released by the nation’s Cabinet, China aims a broader push to lead in the automotive technology,
by 2020 to shut down plants that fail to meet the energy- curb pollution and cut dependence on imported oil. The
saving standard. By 2017, the nation aims to cut total coal government said last month it will boost subsidies to
consumption to below 65% of its total primary energy use speed up the building of recharge stations and has banned
as part of adjustments to its energy structure. The 2013 Air cities from imposing purchase restrictions on new-energy
Pollution Prevention and Control Action Plan pledged to vehicles, indicating likely priorities to be later included in
increase clean energy supply and cut coal consumption, the 13th Five-Year Plan (Xinhua 2015a).
a major source of air pollutant emissions (Xinhua 2015b).
Rising from the Ashes
China is set to become a global nuclear energy player
with its possession of 110 operational nuclear reactors by The year 2015 was a dismal one for China’s chemicals
2030. Power Construction Corp of China Ltd – also known industry, to say the least.
200
commensurate air quality improvements are achieved” as PowerChina – said exports of indigenous technologies
(Wagner 2013). are to be a “key thrust” in the nation’s 13th Five-Year Plan
(2016-20), with the total scale of nuclear power generation
Natural Gas Price Liberalization from reactors both under construction and in operation
in the country reaching 88 gigawatts by the end of 2020.
In what is being referred to as “a major step” in the Though it is only a draft proposal, the State-owned firm
country’s reform to marketize energy prices, Beijing said it will “set the tone during the annual legislative and
in November 2015 cut mainland China’s natural gas political advisory sessions in 2016”. Nuclear is set to be one
wholesale price by an average 28% and announced that of the major beneficiaries of China’s embarking on a clean
it was giving up much of its control over price setting. energy drive to reduce emissions; at the same time, China
Benchmark non-residential gas prices at city gates, where is also looking to popularize its homegrown pressurized-
ownership transfers from producers to distributors, water nuclear technology known as Hualong One both at
were slashed by 0.7 yuan per cubic meter starting on home and abroad. China National Nuclear Corp chairman
November 20th. A statement from the National Reform Sun Qin said: “Third-generation nuclear technology meets
and Development Commission read: “Since the nation last the highest requirements for global safety standards and
[adjusted prices] on April 1st, gas demand and supply both has a competitive edge over others in terms of economic
in and outside the nation has changed markedly…the performance and reliability” (Chang 2015).
nation has decided to take advantage of this opportunity
to sharply lower non-residential prices and further push A forecast from the China Association of Automobile
forward price liberalization” (Ng 2015). Manufacturers (CAAM) sees China’s electric car market
surpassing the US to rank first worldwide, with car sales
Aside from cutting prices, the NDRC said it would allow expected to reach 220,000 to 250,000 for 2015. Deputy
buyers and sellers negotiate and set their prices from secretary-general Xu Yanhua of CAAM said worldwide
November 20th next year, as long as they agree on prices electric car sales will hit 600,000 and the figure for the US
no more than 20% above or below the benchmark prices. market is estimated to be 180,000: “Although China has
Due to low international prices, with both crude oil and achieved rapid development of the industry”, Xu told an
natural gas prices having fallen by more than half since industry conference, “quality instead of quantity should
mid-last year due to a rising supply, the commission said be focused on for the sustainable development of the
traders will only be allowed to set prices at or up to 20% industry”. In particular, Xu emphasized vehicle safety and
below the benchmarks between November 20th this year the careful examination/supervision of battery quality. In
and the year after that (Ng 2015). part thanks to extensive government subsidies and tax
cuts, China’s new energy vehicle sector has seen explosive
Focus on Clean Energy growth over the past two years: According to data provided
by CAAM, the first ten months of the year saw sales of
In early December 2015, the State Council announced electric cars surging 290% year-on-year to 171,145. China’s
their goal to upgrade coal-fired power plants to cut government is likely focusing on improving infrastructure
pollutant discharge by 60% before 2020, saving around and technology to promote sales of alternative-energy
100 million tons of raw coal and reducing carbon dioxide vehicles in its 13th Five-Year Plan (2016-2020): It has made
emissions by 180 million tons annually. According to the the development of EVs a strategic initiative as part of
statement released by the nation’s Cabinet, China aims a broader push to lead in the automotive technology,
by 2020 to shut down plants that fail to meet the energy- curb pollution and cut dependence on imported oil. The
saving standard. By 2017, the nation aims to cut total coal government said last month it will boost subsidies to
consumption to below 65% of its total primary energy use speed up the building of recharge stations and has banned
as part of adjustments to its energy structure. The 2013 Air cities from imposing purchase restrictions on new-energy
Pollution Prevention and Control Action Plan pledged to vehicles, indicating likely priorities to be later included in
increase clean energy supply and cut coal consumption, the 13th Five-Year Plan (Xinhua 2015a).
a major source of air pollutant emissions (Xinhua 2015b).
Rising from the Ashes
China is set to become a global nuclear energy player
with its possession of 110 operational nuclear reactors by The year 2015 was a dismal one for China’s chemicals
2030. Power Construction Corp of China Ltd – also known industry, to say the least.
200
