The month-on-month growth rate of electricity demand has turned positive, resulting in a tightening power supply and demand situation. CEC has released its forecast report analyzing the national power supply and demand in the first half of 2023. According to the report, the following key points are expected:

1. In the second half of 2023, social electricity consumption is anticipated to increase by 6% to 7% year-on-year, compared to a 5.0% increase in the first half of the year.

2.During the summer of 2023, the national maximum electricity consumption load is predicted to rise by 0.8 to 100 million kilowatts compared to the previous year (2022). This projection remains consistent with previous quarterly analyses and forecasts. NDRC has reported that the nation’s highest electricity consumption load has reached record highs twice, with the peak load reaching 1.34 billion kilowatts, a 0.5 billion kW increase compared to the previous year.

Ensuring sufficient power supply during peak seasons has been a focal point in various policies. To bridge the power supply and demand gap during the 14th Five-Year Plan, a key solution lies in enhancing the output of peak thermal power. The government plans to achieve this by promoting the expansion of thermal power installed capacity and ensuring sufficient power supply during peak periods through capacity tariffs and other policy measures. The thermal power business model is expected to undergo reshaping under the new tariff mechanism, leading to more stabilized profits for coal power units, reducing Return on Equity (ROE) volatility to a reasonable level.

CEC has revised its forecast for PV installed capacity, projecting a sustained high growth rate in the second half of 2023. As per the latest forecast report, China’s grid-connected PV installed capacity is anticipated to reach 530 GW by the end of 2023, showing a significant increase of 140GW compared to the previous quarter’s analysis. In the first half of 2023, China witnessed remarkable progress in PV installations, with new installed capacity totaling 78.4 gigawatts (GW), representing an impressive 154% year-on-year growth. Notably, the centralized and distributed PV new installed capacities accounted for 37.4 GW and 41.0 GW, respectively, exhibiting remarkable growth rates of 234% and 108% year-on-year.