China Guodian Corp, the country's third largest power producer by installed capacity, has embarked on power projects costing 20 billion yuan in Ili Kazak autonomous prefecture.

The company has signed an agreement with the local government, under which it plans to start a thermal power plant and a hydropower plant before 2010, said Liu Kemou, an official with the information department of Guodian yesterday.

The company will also work for the approval of several other hydropower projects, he said.

Among China's five leading power companies, Guodian is the first to enter Ili. In 2006 its Jilintai hydropower project, which is also the largest hydropower project in Xinjiang, started operation, improving the power supply in the region.

In the 11th Five-Year Plan period (2006-10), Guodian will develop 12 energy projects in Xinjiang. These will have a total installed power capacity of 4,640 mW and a coal production capacity of 6 million tons per year.

By the end of 2007, Guodian had an installed capacity of 60 gW, with coal-fired power plants accounting for 90.3 percent and hydropower 7.2 percent.

The company is also diversifying its power resources for sound development. Last year it launched its first nuclear project in Fujian province. The company has set up a division to work on the project in Zhangzhou, a coastal city in the southeast of Fujian, said a source.

With coal prices continuing to rise, two of China's biggest power producers have said they expect to post losses for the first half of the year. Huaneng Power International Inc, the listed arm of China Huaneng Group, said on July 15 that power generation rose 13 percent in the first half of 2008. However, the company said it would likely record a loss for the period due to substantially higher coal prices.

On the same day, Huadian Power International Corp, the listed arm of China Huadian Corporation, said it expected a net loss for the first six months of 2008. The company said a 65 percent growth in electricity production had failed to offset higher coal prices.

Because of the soaring coal prices, China's leading power producers have all begun to eye clean energy for power generation. China Huaneng Group is now developing wind power plants in provinces such as Hainan, Guangdong, Jilin and Shandong, and the Inner Mongolia autonomous region.

Huaneng is also quickening its development of hydropower and nuclear power. It is now constructing several hydropower projects on the Lancang River in Yunnan, with a total capacity of 15,000 mW. The company is also planning China's first nuclear power project using high-temperature gas-cooled technology in Rongcheng in Shandong.

(China Daily July 18, 2008)