The IEA Releases Market Forecast on PR China


Recently, the IEA has released an overview centering on China’s market prospect in year 2019. Enlightening as it might prove to be, the overview makes clear its introductory nature and implied lack of depth and industry-specific details at the outset.

The introduction of the overview reads as follows: “Power Sector Reform in China: an International Perspective is aimed at foreigners trying to understand the mechanics and recent developments of China’s power sector, and Chinese readers looking for international experiences that are relevant to the implementation of China’s current power sector reforms.

The report explains many of the unique features of China’s power sector, and provides the context necessary to understand both the prevailing institutional framework and the level of ambition of the ongoing reforms under “Document No 9”, the most recent effort of the Chinese government to update the rules governing the largest power sector in the world. Considering the challenges ahead, the IEA presents a series of examples from power reforms elsewhere, hoping that they will provide insights to Chinese policy makers in their efforts towards an efficient, secure and sustainable power system.”

A quick browse reveals that the focus of this work is China’s transition from the heavy reliance on coal-generated electricity to the partial adoption of generating electricity by other, more efficient and less wasteful ways, typified by wind farms, hydro, solar and nuclear. Despite certain facts to the contrary, most notably China’s purported increase in the coal and oil import, the IEA’s overview concludes on a highly optimistic note, claiming that “…Thus, steps towards greater efficiency in the system must inspire confidence that they will address not only the current overcapacity but also future investment needs. Moreover, this reform is not implemented in a vacuum, nor in a static power sector. The Chinese energy system is on a clear path to becoming more ecological and contributing to a cleaner environment. China has already successfully taken steps in this direction, and implementation of the power market reform can continue to bring important benefits in this regard.”

Of course, NEEC, ever the loyal informer, leaves the judgmental privileges to those more professionally and financially concerned, and the overview could be accessed here: IEA OVERVIEW ON CHINA