Heavy industry warming is the main reason

The growth rate of electricity consumption in September turned negative, mainly driven by the rebound in industrial electricity consumption. This also shows that China's industrial situation has improved, but the slowdown in growth rate reflects that the downward pressure on the Chinese economy has not been eased.

The National Energy Administration released data on October 16 that in September, the entire society used 457 billion kWh of electricity, an increase of 2.7% year-on-year. Experts pointed out that the growth rate of electricity consumption in September turned from negative to positive, mainly driven by the rise in industrial electricity consumption, which also shows that China's industrial situation has improved.

Data show that following the negative growth of 1.5% of total electricity consumption in the whole society in August, the growth rate of electricity consumption in September was positive, but its 2.7% increase was the next lowest in April 2013 and up to 18 months.

Lin Boqiang, director of the China Energy Economic Research Center at Xiamen University, said that under normal circumstances, electricity consumption growth is proportional to economic growth. The slowdown in growth rate reflects that the downward pressure on the Chinese economy has not eased. In September, the second industry used 322.1 billion kWh, an increase of 5.2% year-on-year, of which heavy industry electricity consumption was 258.1 billion kWh, an increase of 5.3% year-on-year. "The increase in electricity consumption growth is mainly related to the recovery of heavy industries." Lin Boqiang said.

At present, China’s industrial electricity consumption accounts for 70% of the total electricity consumption in the society. Among this, electricity consumption of high energy-consuming industries such as steel, cement, and petrochemical accounts for about half of the electricity consumption of industrial electricity consumption. The fluctuations have a lot to do with the production situation of these industries.

Hu Zhaoguang, vice president of the National Grid Energy Research Institute, believes that the "negative growth" of electricity consumption in August is mainly affected by the weather and is of a special nature. Therefore, the electricity consumption in September will be closer to the economic development situation.

Experts stated that during the process of economic restructuring, the proportion of consumption and service industries is increasing. It is normal for fluctuations in single-use indicators such as electricity consumption in August and September. It is expected that the trend of growth in electricity usage in the second half of this year will still be low first and then high. Under the new normal, it is no longer just to emphasize growth. It is expected that the growth in electricity consumption will hardly rebound significantly in the next few months.

It is worth noting that in the first three quarters, the electricity consumption structure in China was significantly improved, and the proportion of electricity used by the tertiary industry was continuously increasing. From January to September, the country’s total electricity consumption amounted to 4,097.5 billion kwh, an increase of 3.9% year-on-year. In terms of sub-sectors, the primary industry's electricity consumption was 78.3 billion kWh, an increase of 2.4% year-on-year; the secondary industry's electricity consumption was 2982.7 billion kWh, an increase of 4.0% year-on-year; the tertiary industry's electricity consumption was 503.3 billion kWh, a year-on-year increase of 5.7 %.

The share of clean energy generation is also rising. From January to September, the cumulative average utilization of power generation equipment in the country was 3,204 hours, a year-on-year decrease of 174 hours. Among them, the average utilization hours of hydropower equipment was 2,723 hours, an increase of 84 hours year-on-year; the average utilization hours of thermal power equipment was 3512 hours, a year-on-year decrease of 182 hours. From January to September, the country’s new power generation capacity was 52.5 million kilowatts, of which 15.65 million kilowatts of hydropower and 25.8 million kilowatts of thermal power.