BEIJING, April 9 (Xinhua) -- China's electricity regulator has advised
major power companies to merge with or acquire coal producers and transporters
to help stabilize costs and supplies.
Utilities could slow the expansion of their thermal-power capacity and
instead invest in coal transport firms and mines, Zou Yiqiao, director of the
price and financial supervision department of the State Electricity Regulatory
Commission (SERC), was quoted as saying by Shanghai Securities News on
Zou suggested that the government would allow power costs to reflect coal
prices when the timing was appropriate. A more rational relationship between
coal and electricity prices would help ensure sustainable industry development
and adequate power supply, which was critical for the economy and living
standards, he said.
The government froze electricity prices to prevent rising coal costs from
flowing through to end users, but soaring coal prices forced many power plants
to run at a loss.
Among 4,773 large-capacity power plants, almost 42 percent recorded a loss
in the first two months of 2008, or 6.35 percentage points more than a year
earlier, a report by SERC said. The losses totaled 13.79 billion yuan (1.97
billion U.S. dollars),more than triple the year-earlier figure.
Amid rising coal costs, economic planners are attempting to use other means
to boost electricity generation by emphasizing renewables. The National
Development and Reform Commission (NDRC) on Tuesday announced a subsidy plan,
under which methane-to-electricity plants will get 0.1 yuan per kilowatt