On July 15, four state bodies jointly ordered a halt to the construction of 32 power stations, 10 and 11 of which are in Henan Province and Inner Mongolia Autonomous Region respectively, because they do not meet environmental and other national standards.

The National Development and Reform Commission (NDRC), the State Environmental Protection Administration and the ministries of land and resources and water resources announced that problems with the plants included illegally drawing groundwater.

The NDRC said these projects breached rules and regulations concerning land requisition, environmental protection, and water and soil preservation, so could not be included in the country’s short-term power development planning.

With a total planned capacity of 17.114 million kilowatts, the power stations required investment of 85.5 billion yuan (US$10.5 billion), with 20 billion yuan (US$2.46 billion) already spent.

“Letting their construction continue would not only adversely affect the development of the power industry, but would also bring about risks to the financial sector, influencing sustainable economic development,” said an NDRC official.

In February, the General Office of the State Council called on government departments to put a stop to the building of illegal power stations, saying that they would “disturb implementation of the state’s overall energy strategy, causing chaotic power construction and contradictions between coal supply and limited transportation capacity.”

At that time, according to the NDRC, illegal power station projects had a total capacity of 125 million kilowatts. They had no approval for their feasibility reports, had not applied for examination or approval, or had not suspended construction after being instructed to previously.

The NDRC said all the stations should stop construction and planning immediately and local departments take up their responsibilities in dealing with any remaining problems.

Power plant projects have become attractive to many localities as a source of inward investment. Along with an increase in demand for electricity, this has encouraged their construction even when regulations have not been met.

(China Business News translated by Zhang Tingting for China.org.cn, July 28, 2005)