Electricity

Electricity Global Market Overview

• The global power generation is expected to grow at approx. 2-3 percent CAGR through 2022-2025

• China's power consumption increased by 3.6 percent year-on-year in 2022, reaching 8,637 TWh. In 2022, power consumption in China's primary, secondary, and tertiary sectors was 114.6 TWh, 5,700.1 TWh, and 1,485.9 TWh, representing year-on-year growth of 10.4 percent, 1.2 percent, and 4.4 percent, respectively

• The installed capacity till the first half of 2022 was 2.44 TW and is expected to reach 2.6 TW by end of 2022. From January to November 2022, the total electricity generation was 7,628.6 TWh with a 2.1 percent year-on-year increase

• The installed capacity of non-fossil fuel generation is 1.18 TW, accounting for 48.2 percent of the total capacity by the end of November 2022. Wind and solar installed capacities are around 351 GW and 372 GW, respectively

Industry Structure and Outlook : Electricity

Generation Capacity

• China’s generation capacity has been growing strong in the last 5 years even in the renewable generation capacity. Despite the commitment to reduce GHG emissions the fossil fuel based generation capacity has also grown

• Electricity generation capacity is expected to grow at a CAGR of 3 to 5 percent for next year, with wind and solar will contribute the major growth factor. The year-on-year increase in hydropower and solar installed capacity exceeded 20 percent in 2022

• China’s dependence on thermal power capacity increased from 70 percent in 2018 to 57.4 percent in 2022, and it can be expected to go below 50 percent by 2030 if the coal power production curb continues. There was a decrease of 4 percent year-on-year in the first half of 2022

• China’s total electric power capacity increased to just over 2.51 terawatts, with hydro, wind, and solar sources, accounting for 45 percent in 2022 up from 39 percent in 2020

Fuel Mix

• The fuel mix has changed significantly in the last five years, from insignificant generation from renewables in 2015 to about 982 TWh generation from solar and wind based generation in 2021

• Due to high summer, the coal power generation share has increased to 69 percent in 2022, as there was low output from hydro, due to low water levels. The thermal power share was 67 percent in 2021, as a result of a large increase in renewable generation

• The nuclear expansion has resulted in an increase in generation share from 3 percent in 2016 to 4.95 percent by 2022, with year-on-year growth rate of 2.1 percent

• The power generation from hydro increased by more than 20 percent in the first half of 2022, but there was a decline in the power output, due to high summer temperature. China will have massive hydro energy growth in the future to obtain sustainability

Electricity : Supply and Demand

• With the large-scale manufacturing projects, the country's electricity demand is predicted to continue to expand at a rate of 2-4 percent

• Electricity generation is expected to grow at a CAGR of 2–4 percent for the next two years to keep up with consumption which is also in same trend

• Electricity consumption in the grid is expected to grow at a CAGR of 2-4 percent for the next two years, reaching around 8800 TWh in 2023

• Transmission losses are at 5–6 percent currently, which is lower than the world average of 8 percent and it is expected that the losses will remain at a level of 5–6 percent for the next couple of years

• Dependence on hydro, wind, and solar rose to around 28 percent in 2022, in terms of electricity generation, and by 45 percent, in terms of electricity generation capacity

Electricity Market Consumption Outlook

• Secondary industries are the largest consumers of electricity this sector is one of the fastest growing in the Chinese economy consumes about 67.5 percent of the country’s power consumption

• In 2022, power consumption in China's primary, secondary, and tertiary sectors was 114.6 TWh, 5,700.1 TWh, and 1,485.9 TWh , representing year-on-year growth of 10.4 percent, 1.2 percent, and 4.4 percent, respectively.  The secondary industry has the highest share of 66 percent in the consumption share in 2022, followed by the tertiary industry sector with a 17.3 percent share

• The tertiary industry sector had an increase in the growth rate of 17 percent in 2010–2022 as expected, but the primary sector had the highest growth rate compared to other sectors around 19 percent

• In 2022, industrial consumption had increased it consumption by 1.2 percent year-on-year to reach 5,600 TWh, accounting for 64.8 percent of the total consumption. The manufacturing sector had only 0.9 year-on-year growth in 2022 compared to 2021