Beijing, China — China’s rapid infrastructure development is driving a significant increase in electricity demand, particularly in emerging sectors such as 5G, artificial intelligence, and electric vehicles. Industry experts, including Zhang Zhigang, executive chairman of State Grid Corp of China, have highlighted the necessity for stable power supplies to support this growing demand.
During the 2024 New Power System Development Forum, Zhang noted that electricity consumption for internet data services, including big data processing and cloud computing, has experienced an impressive annual growth rate of 28% from 2018 to 2023, with a further increase of 33% in the first half of this year. This surge is closely linked to China’s ongoing economic expansion, particularly in advanced manufacturing and industrial internet applications.
The country has also made strides in renewable energy, with wind and solar power capacity increasing by 35.5% year-on-year in 2023, reaching 226 million kilowatts in State Grid’s operational area. From January to August, an additional 130 million kW of renewable capacity was added, demonstrating a 12.6% increase.
Strategic Investments and Innovations
To address the challenges posed by this growing energy demand, the National Energy Administration is prioritizing the acceleration of power grid construction and enhancing transmission mechanisms. The administration aims to complete 33 key projects this year, including the Sichuan-Chongqing ultra-high voltage alternating current project, while also initiating 37 additional key projects.
Zhang emphasized that technological innovation is vital for building a new power system, with State Grid allocating 180 billion yuan (approximately $25.6 billion) for research and development during the 14th Five-Year Plan (2021-2025). He underscored the importance of energy storage in supporting the new power system, noting that State Grid is advancing large-scale energy storage applications, including 93.97 million kW of pumped storage capacity.
The company also reported an annual grid investment exceeding 600 billion yuan for the first time this year, representing an increase of 71.1 billion yuan compared to the previous year. This investment is primarily focused on constructing ultra-high voltage power transmission projects, which enhance connectivity between county-level grids and the main grid while upgrading digitalization and intelligence within the grid.
Future Outlook
As China continues to integrate renewable energy sources into its grid, the government is committed to enhancing the grid’s capacity for flexible power supply scheduling and improving interprovincial power-sharing capabilities. Increased investment in ultra-high voltage transmission lines, which significantly reduce transmission losses and extend operational distances, will further facilitate the delivery of energy from large wind and solar power bases in western regions.
These strategic efforts aim not only to meet rising energy demands but also to bolster the country’s transition towards a sustainable and resilient energy landscape.