Electricity investment exceeds 15 billion yuan in two weeks

As the economy further stabilized, the pace of investment in power construction that is closely related to the economy began to accelerate. Following last week’s approval of a total of 11.4 billion yuan worth of electricity investment projects, yesterday the National Development and Reform Commission approved 8 power transmission and transformation projects and substation expansion projects, totaling 4.299 billion yuan, which means that it has been approved for power investment projects since December. Over 15 billion yuan is rare this year. In the industry analysis, the National Development and Reform Commission's intensive approval of power investment projects may prepare for the recovery of high power growth. It also reflects the current economic growth's over-reliance on investment, and needs to be alert to issues such as overcapacity and infrastructure idleness caused by investment.

16 projects approved in two weeks

According to incomplete statistics, in the past two weeks, the National Development and Reform Commission approved a total of 16 power investment projects, including 7 substation expansion projects, 7 power transmission and transformation projects, and 2 power station projects with a total amount of 15.627 billion yuan. Distributed in the eastern and central regions of Anhui, Hunan, and Shandong, this is also the first time this year that the National Development and Reform Commission has intensively approved power transmission projects based on power transmission and transformation substations.

Zhang Zhibin, an analyst in the power and coal industry at China Coal Grand Consulting Center, said that the power investment has a close relationship with the economic situation. Since the economy was relatively weak this year, the construction speed of power grids and substations has generally declined. However, in recent months, the economy has seen a clear return to the bottom, and the enthusiasm for launching power projects has been restored throughout the country.

For the economic recovery to take precautions

Zhao Hong, deputy dean of the Beijing Academy of Social Sciences, said that the economic recovery in the fourth quarter is a foregone conclusion. It is widely expected in the industry that the economic situation in the next two years will be better than this year, which instills confidence in electricity investment. After the previous round of economic restructuring, local governments have gradually shifted from the land finance, which focuses on real estate development, to the emphasis on the development of the real economy. This will also stimulate future demand for electricity and increase the number of power projects. Investment is necessary.

“The construction period of power transmission substation projects is generally 1-3 years. Now, centralized approval is to prepare for the recovery of high power demand in the next few years.” Zhang Zhibin said that the central and eastern regions are the main regions for generating electricity and electricity, and also the former “electricity”. In the worst-hit areas, the state has focused on strengthening the construction of power stations and power grids in these areas with the intention of taking precautions.

Investment dependency has not disappeared

However, there are also industry insiders believe that the National Development and Reform Commission intensively approved power projects also reflect the current economic growth over-reliance on investment. According to incomplete statistics from the reporter, since December, the National Development and Reform Commission has significantly accelerated the progress of project approval. As of December 10, the National Development and Reform Commission has approved 37 investment projects of various types this month, exceeding 17 of the entire month of November. The latest data from the Statistics Bureau showed that in the first November, the central project invested 1.7998 trillion yuan, an increase of 6.1% year-on-year, and the growth rate was 1 percentage point higher than that in the previous October; the local project investment was 3,0828 billion yuan, an increase of 21.7%, down 0.1%. The total investment for the new construction projects is planned to reach 287.332 billion yuan, a year-on-year increase of 28.8% and an acceleration of 2.1 percentage points.

In December, investment plans were launched across the country: The Sichuan Ziyang Chamber of Commerce was established in Guangzhou. At the conference, 132 investment projects were promoted in Ziyang City, Sichuan Province, with an investment of 102.0555 billion yuan; a centralized signing ceremony was held in Bozhou City, Anhui Province. A total of 109 projects have been signed with a total planned investment of approximately 82.2 billion yuan.

In this regard, Zhou Qingjie, director of the Center for Economic Research of Beijing Technology and Business University, said that investment is now used as the main means of stimulating economic growth from the central to the local. The NDRC's intensive approval of power projects also reflects the current economic growth dependence on investment.

Chen He, director of the Institute of Industrial Economics at the Capital University of Economics and Trade, reminds that although investment will play a significant role in stimulating the economy in the short term, in the long run, it will bring about problems such as excess capacity and idle infrastructure. The government should plan well in advance. Solve the short-term benefits and long-term balance of investment.