China’s Natural Gas Production Achieved Double-digit Growth in the First Half of the Year

On July 25, the State Energy Administration held a press conference to introduce China’s energy situation. Li Fulong, Director of the Development Planning Department of the State Energy Administration, said that in the first half of the year, China’s economy was running smoothly on the whole, and positive progress was made in high-quality development. Energy supply and security capabilities were constantly improved, and people’s livelihood security of energy continued to improve.

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Reversing the declining trend of crude oil production

According to statistics, in the first half of this year, China has made positive progress in increasing oil and gas reserves and production. China’s crude oil production reached 95.39 million tons, up 0.8% year-on-year, reversing the trend of decline in the past three years; natural gas production reached 86.41 billion cubic meters, up 10.3% year-on-year.

In terms of electricity, in the first half of the year, a total of 40.74 million kilowatts of new electricity were installed throughout the country. Among them, hydropower 1.82 million kilowatts, wind 9.09 million kilowatts, photovoltaic 11.4 million kilowatts, nuclear power 1.25 million kilowatts, non-fossil energy generation accounted for 58.4% of the increase.

The proportion of non-fossil energy power generation continues to increase. By the end of June, non-fossil energy accounted for 37.2% of the 6,000 kW and above power generation installed in China, which was 1.2 percentage points higher than the same period last year; non-fossil energy accounted for 27.3%, which was 2.1 percentage points higher than the same period last year.

Investment in energy supply board has increased substantially. In the first half of this year, investment in oil and gas exploitation increased by 34.1% year on year, 31.3 percentage points faster than the same period last year. Renewable energy investment in power generation increased by 36.3% year on year. The contribution of energy industry investment to social investment has increased. In the first half of the year, the cumulative investment in the energy industry increased by 1.9% year-on-year, accounting for 4.5% of the national fixed investment.

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Power consumption growth slowed down

Electricity consumption is an economic barometer. In the first half of this year, the electricity consumption of the whole society increased by 5.0% year on year, which is lower than the annual electricity consumption growth rate of 8.5% in 2018. In response, Li Fulong said that although the growth rate of electricity consumption has fallen from last year, it is still a relatively high growth rate in recent years. In recent years, China’s industrial structure has been continuously optimized, and the proportion of service industry has continued to increase. The change of economic structure is particularly evident in the aspect of electricity consumption.

In terms of electricity consumption structure, in the first half of this year, the proportion of electricity used by the third generation and residents was 31%, which was 1.2 percentage points higher than that of the same period last year; the proportion of electricity used by the second generation was 68%, which was 1.2 percentage points lower than that of the same period last year. From the contribution rate, the total pull-up power consumption of the third generation and residents increased by 2.8 percentage points, the contribution rate was 56.5%, 14 percentage points higher than the same period last year.

In the first half of this year, the power consumption of advanced manufacturing and high-tech industries has maintained a relatively rapid growth, such as special equipment manufacturing, electrical machinery and equipment manufacturing. The power consumption of information transmission/software and information technology services has increased by more than 13%, and the power consumption of emerging industries has increased by 4%. 9%, higher than 1.5 percentage points of the growth rate of electricity consumption in manufacturing industry.

According to Li Fulong, from the international experience, the process of industrial restructuring and the increase of the proportion of service industry is usually accompanied by the decline of the growth rate of electricity consumption. Therefore, at present and in the future, the shift of electricity consumption from the high-speed growth stage in previous years to the current medium-speed growth stage is an inevitable trend.

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The abandonment of water, wind and light continued to alleviate

In the first half of this year, the State Energy Administration further improved the competitive allocation mechanism of new energy power generation projects by establishing and improving the guarantee mechanism of renewable energy power absorption, and actively took measures to intensify efforts to absorb renewable energy, so that the situation of abandoned water, abandoned wind and abandoned light continued to ease.

In terms of installation, by the end of June, the installed capacity of renewable energy power generation in China reached 750 million kilowatts, an increase of 9.5% over the same period last year. Among them, 354 million kilowatts are installed for hydropower (29.99 million kilowatts for pumped storage), 193 million kilowatts for wind power, 186 million kilowatts for photovoltaic power and 19.95 million kilowatts for biomass power.

Regarding the level of renewable energy utilization, in the first half of this year, renewable energy power generation reached 887.9 billion kWh, an increase of 14% over the previous year. Among them, 513.8 billion kWh of hydropower increased by 11.8%, 214.5 billion kWh of wind power increased by 11.5%, 106.7 billion kWh of photovoltaic power increased by 30% and 52.9 billion kWh of biomass power increased by 21.3%. At the same time, the national abandonment rate was 4.7%, 4 percentage points lower than that of the previous year; the abandonment rate was 2.4%, 1.2 percentage points lower than that of the previous year.

In May this year, the State Energy Administration issued the Notice on the Construction of Wind and Photovoltaic Power Projects in 2019, which initiated the application of the State Subsidies for Photovoltaic Power Projects in 2019. “The implementation of photovoltaic power subsidy bidding is a major reform and innovation of photovoltaic power construction management policy.” Li Chuangjun, deputy director of the Department of New Energy and Renewable Energy of the State Energy Administration, said that the policy promoted the decline of subsidies for photovoltaic power generation projects. This year, the average intensity of subsidies for kilowatt-hour electricity included in the list of projects under the scope of subsidy bidding was about 0.0645 yuan per kilowatt-hour, which was more than 50% lower than the guided price.