The 18th National Party Congress clearly emphasized that China's fundamental national condition—remaining at the primary stage of socialism—has not changed. Persistent issues such as unbalanced, uncoordinated, and unsustainable development continue to exist, highlighting the urgent need to improve the quality and efficiency of growth. The Congress called for urgent adjustments in economic structure and improved livelihoods. It outlined a new strategic deployment under the "New Sihua" framework, proposing a five-in-one comprehensive layout, with particular emphasis on enhancing innovation, promoting economic restructuring, integrating urban and rural development, improving the open economy, and advancing resource conservation and environmental protection. These initiatives have raised higher expectations for the power industry.
Firstly, the "two doubles" strategy and the push for urbanization introduced new demands for the electrical industry. It is projected that by 2020, China will achieve a moderately prosperous society, with per capita energy consumption reaching 3.8 tons of standard coal. Total energy consumption is expected to reach 5.3 billion tons, marking a 63% increase from 2010 levels. Currently, China's urbanization rate exceeds 50%, but developed countries typically range between 75% and 80%. Urbanization brings fundamental changes in production, living, and exchange methods, leading to a threefold increase in energy consumption from rural to urban areas.
Experts predict that electricity will account for 25% of terminal energy consumption by 2015, with national electricity demand reaching 7-8 trillion kWh by 2020. Based on this, the installed capacity in 2012 was approximately 1.14 billion kilowatts. With an estimated 60% increase, the electrical industry must embrace intensive, smart, green, and low-carbon development paths. Additionally, the construction of an ecological civilization and the vision of a "beautiful China" necessitate a deep transformation in energy development. Future efforts will focus on balancing energy and environmental development, shifting from heavy reliance on fossil fuels toward renewable energy sources, creating more opportunities for electrical equipment manufacturers.
According to the National Energy Administration’s 2013 forecast, China’s economy is expected to stabilize and grow, driving increased electricity demand. In 2013, the country added 90 million kilowatts of new capacity, including 36 million kW of thermal power, 21 million kW of hydropower, 3.24 million kW of nuclear power, 18 million kW of wind power, and 10 million kW of photovoltaics. Non-fossil energy accounted for 58% of the total. By the end of 2013, total power generation capacity is expected to reach 1.23 billion kW, placing China at the top globally.
With the restart of coastal nuclear projects, nuclear power construction is gaining momentum, potentially doubling the number of ongoing projects from 2012. Wind and solar power are also set to grow significantly in 2013, supported by national policies. Environmental protection efforts are intensifying, pushing the power industry toward green and sustainable development. This shift creates new opportunities for high-efficiency, low-consumption, and intelligent electrical equipment.
In recent years, China has accelerated its transition toward more efficient power development, enhancing the grid's ability to allocate energy across large regions. The construction of a strong smart grid, based on ultra-high voltage (UHV) transmission lines, is progressing. Several UHV projects are under construction, including the Huinan-Minnan-Zhebei-Shanghai and Haminan-Zhengzhou lines. In 2013, the State Grid planned to start four new UHV lines, further expanding the network. Over the next eight years, the State Grid Corporation will invest around 1.2 trillion yuan, building 94,000 km of UHV lines and adding 320 million kVA and 460 million kW of capacity. These projects are expected to drive significant growth in power transmission and transformation manufacturing.
The 2013 Government Work Report set a target of about 7.5% economic growth. The recovery momentum is expected to strengthen, and policy continuity supports a favorable macroeconomic environment for the equipment manufacturing sector, including the electrical industry. However, challenges remain, such as overcapacity, rising accounts receivable, declining profits, and increasing trade tensions. These factors cannot be ignored.
It is expected that the growth rate of production and sales in the electrical industry in 2013 will remain around 12%-15%, similar to 2012. With policy support and a low base in 2012, profit growth is likely to accelerate alongside production and sales. However, import and export activities may still face difficulties similar to 2012. In 2013, imports of electrical products, export value, and total trade volume may see a modest increase of less than 5%. Based on the forecast of 90 million kW of new power generation capacity, the output of power generation equipment is expected to reach 110-120 million kW, transformers to 1.4 billion kVA, and high-voltage switchgear to about 1.8 million units.
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