Details on the 13th Five-Year Plan for Electricity

　　At 10 am on November 7, the National Energy Administration held a press conference on the "Thirteenth Five-Year Plan" for Power Development. At the conference, Han Shui, chief engineer of the National Energy Administration, and Huang Xue Nong, director of the Electric Power Department, introduced and interpreted the power plan and answered questions from reporters. The meeting mentioned that during the "Thirteenth Five-Year Plan" period, more than 150 million kilowatts of coal-fired power generation projects were canceled or postponed; by 2020, the national coal-fired power generation capacity will strive to be controlled within 1.1 billion kilowatts. In addition to this, what other content was included in this morning's press conference? Please see the full text.

　　Liang Changxin, spokesperson and director of the Law Reform Office of the National Energy Administration: Good morning to all our media friends, ladies and gentlemen. I am Liang Changxin, spokesperson and director of the Law Reform Office of the National Energy Administration. Today, the National Development and Reform Commission and the National Energy Administration officially released the "Thirteenth Five-Year Plan" for Power Development. This is the action guideline for China's power development during the "Thirteenth Five-Year Plan" period, a guiding document for formulating relevant special plans, and an important basis for the layout of major power projects. Today, in order to help everyone better understand the content of the plan, we have invited Mr. Han Shui, chief engineer of the National Energy Administration, and Mr. Huang Xue Nong, director of the Electric Power Department, to participate in the press conference to introduce and interpret the power plan and answer your questions. Now, let Mr. Han Shui, chief engineer of the National Energy Administration, introduce the overall situation of the "Plan".

　　Han Shui, chief engineer of the National Energy Administration: Good morning to all friends from the press! I am very pleased to have the opportunity to introduce the "Thirteenth Five-Year Plan" for Power Development to you. First of all, thank you all for attending today's press conference, and I sincerely thank you for your long-term attention and support for power development! Now, I will introduce the relevant information of the "Thirteenth Five-Year Plan" for Power Development from four aspects.

　　1. Background and basis for the formulation of the "Plan". Electricity is a basic industry related to national economy and people's livelihood, and the supply and safety of electricity are related to national security strategy and the overall economic and social development. During the "Twelfth Five-Year Plan" period, China's power industry development scale reached a new stage, structural adjustment achieved new achievements, energy conservation and emission reduction reached a new level, equipment and technological innovation made new breakthroughs, international cooperation in electricity expanded a new situation, and system reform opened a new chapter. By the end of 2015, the total electricity consumption of the whole society reached 5.69 trillion kilowatt-hours, the national power generation capacity reached 1.53 billion kilowatts, and the total length of 220 kilovolt and above transmission lines reached 609,000 kilometers, with a substation capacity of 3.37 billion kVA. The proportion of non-fossil energy in primary energy consumption increased from 9.4% in 2010 to 12% in 2015, exceeding the predetermined target.

　　The "Thirteenth Five-Year Plan" is a decisive period for China to comprehensively build a moderately prosperous society, a crucial period for deepening reforms, and also an important opportunity period for the power industry to accelerate its transformation and development. Entering the "Thirteenth Five-Year Plan", the power industry faces a series of new situations and challenges, such as the normalization of loose supply, the cleaning of power structure, the intelligentization of the power system, the internationalization of power development, and the marketization of systems and mechanisms.

　　The "Thirteenth Five-Year Plan" for Power Development was formulated in accordance with the "Thirteenth Five-Year Plan" for National Economic and Social Development of the People's Republic of China and the "Thirteenth Five-Year Plan" for Energy Development. Its content covers various power sources such as hydropower, nuclear power, coal-fired power, gas-fired power, wind power, and solar power generation, as well as the transmission and distribution network. It focuses on expounding the guiding ideology and basic principles of China's power development during the "Thirteenth Five-Year Plan" period, clarifying the main goals and key tasks, and using strategic and guiding ideas and methods. For development indicators, quantification is provided as much as possible, and a clear and explicit description of development goals is given. The "Plan" is the action guideline for power development during the "Thirteenth Five-Year Plan" period, the guiding document for formulating related special plans, and the basis for the layout of major power projects. The planning period is 2016-2020. During the implementation of the plan, rolling adjustments will be made in due course. At the same time, the implementation of the plan will be reviewed and fine-tuned annually.

　　2. Guiding ideology and basic principles of power development. We will thoroughly implement the spirit of the 18th National Congress of the Communist Party of China and the Third, Fourth, Fifth, and Sixth Plenary Sessions of the 18th Central Committee, implement the development strategy of "four revolutions and one cooperation", firmly establish and implement the new development philosophy of innovation, coordination, green development, openness, and sharing, and in accordance with the relevant deployments of the "Thirteenth Five-Year Plan" for National Economic and Social Development of the People's Republic of China and the "Thirteenth Five-Year Plan" for Energy Development, we will strengthen overall coordination, technological innovation, and international cooperation; focus on adjusting the power structure, optimizing power generation layout, upgrading distribution networks, enhancing system regulation capabilities, improving power system efficiency, and promoting system reform and mechanism innovation; accelerate adjustment and optimization, transformation and upgrading, and build a clean, low-carbon, safe, and efficient modern power industry system to benefit a wide range of electricity users and provide strong support and guarantee for the comprehensive building of a moderately prosperous society.

　　The basic principles of power development in the next five years are: "overall planning and coordination; clean, low-carbon, and green development; optimized layout and safe development; intelligent, efficient, and innovative development; deepening reform and open development; ensuring people's livelihood and sharing development".

　　3. Power development goals and main tasks. The "Plan" draws a blueprint for power development during the "Thirteenth Five-Year Plan" period from eight aspects: supply capacity, power structure, grid development, comprehensive regulation capacity, energy conservation and emission reduction, people's livelihood electricity supply guarantee, technological equipment development, and power system reform:

　　1. In terms of supply capacity. It is expected that by 2020, the total electricity consumption of the whole society will reach 6.8-7.2 trillion kilowatt-hours, with an average annual growth of 3.6-4.8%, and the national power generation capacity will reach 2 billion kilowatts, with an average annual growth of 5.5%. Per capita installed capacity will exceed 1.4 kilowatts, and per capita electricity consumption will be around 5000 kilowatt-hours, approaching the level of moderately developed countries. The level of rural and urban electrification will be significantly improved, and the proportion of electricity in terminal energy consumption will reach 27%.

　　2. In terms of power structure. In accordance with the requirement that the proportion of non-fossil energy consumption reaches about 15%, by 2020, the installed capacity of non-fossil energy power generation will reach about 770 million kilowatts, an increase of about 250 million kilowatts compared with 2015, accounting for about 39%, an increase of 4 percentage points, and the proportion of power generation will increase to 31%; the installed capacity of gas-fired power generation will increase by 50 million kilowatts, reaching more than 110 million kilowatts, accounting for more than 5%; the installed capacity of coal-fired power generation will strive to be controlled within 1.1 billion kilowatts, accounting for about 55%. The power structure will be further optimized. There are several key aspects:

　　First, actively develop hydropower and coordinate development and transmission. Under the premise of adhering to ecological priority and proper resettlement of immigrants, hydropower will be actively developed. Focusing on the construction of key hydropower stations in major river basins, scientific development of hydropower resources in Southwest China will be carried out. Adhering to the principle of giving priority to mainstream development and tributary protection, large-scale hydropower base construction will be actively and orderly promoted, and development of small and medium-sized river basins and small hydropower will be strictly controlled. By 2020, the installed capacity of conventional hydropower will reach 340 million kilowatts.

　　Second, vigorously develop new energy and optimize the layout of development and adjustment. In accordance with the principle of combining centralized and decentralized development and prioritizing on-site consumption, the layout of wind power will be optimized, development and market consumption will be coordinated, and wind power and photovoltaic power will be developed in an orderly manner. By 2020, the national wind power installed capacity will reach more than 210 million kilowatts, including about 5 million kilowatts of offshore wind power. Photovoltaic power plants will be laid out in accordance with the principle of decentralized development and prioritizing on-site consumption. By 2020, the installed capacity of solar power generation will reach more than 110 million kilowatts, including more than 60 million kilowatts of distributed photovoltaic and 5 million kilowatts of concentrated solar power. In accordance with the principle of giving priority to existing power, relying on power transmission channels, the cross-provincial and regional consumption of renewable energy in the "Three North" region will be orderly promoted by 40 million kilowatts.

　　Third, safely develop nuclear power and promote the construction of coastal nuclear power plants. During the "Thirteenth Five-Year Plan" period, about 30 million kilowatts of nuclear power will be put into operation nationwide, and the construction of more than 30 million kilowatts will be started. By 2020, the installed capacity will reach 58 million kilowatts.

　　Fourth, orderly development of natural gas power generation, vigorously promoting the construction of distributed gas power generation. During the "13th Five-Year Plan" period, 50 million kilowatts of new gas-fired power generation capacity was put into operation nationwide, reaching more than 110 million kilowatts in 2020, including 15 million kilowatts of combined heat and power generation with heating, electricity and cooling.

　　Fifth, accelerate the transformation and upgrading of coal-fired power generation, and promote clean and orderly development. Strictly control the planning and construction of coal-fired power generation. Reasonably control the construction progress of coal-fired power generation bases, and plan and construct combined heat and power generation projects and low-calorific coal-fired power generation projects in a way that suits local conditions. Actively promote the transformation and upgrading of coal-fired power generation. During the "13th Five-Year Plan" period, more than 150 million kilowatts of coal-fired power generation projects were canceled or postponed. By 2020, the national coal-fired power generation capacity will strive to be controlled within 1.1 billion kilowatts. In addition, the "Plan" will encourage diversified energy utilization and conduct pilot demonstrations according to local conditions.

　　3. Regarding power grid development. Plan outward transmission channels to enhance resource allocation capabilities. Reasonably allocate outward transmission from energy-rich areas, construct ultra-high voltage transmission and conventional transmission technology "West-to-East Power Transmission" transmission channels, with a new scale of 130 million kilowatts, reaching about 270 million kilowatts; optimize the power grid structure and improve system safety levels. The power grid main frame will be further optimized, and inter-provincial interconnection lines will be further strengthened. Fully demonstrate the nationwide synchronous power grid pattern, further adjust and improve the regional power grid main frame, explore flexible interconnection between large power grids, and strengthen the mutual assistance capabilities of inter-provincial power grids within the region. Strictly control the construction cost of the power grid and improve the efficiency of power grid operation. Nationwide, 920,000 kilometers of 500 kV and above AC lines and 920 million kVA of substation capacity were added.

　　Upgrade and transform distribution networks and promote the construction of smart grids. Increase the efforts in the construction and transformation of urban and rural power grids, basically completing a modern distribution network that is comprehensively planned for urban and rural areas, safe and reliable, economical and efficient, technologically advanced, environmentally friendly, and suitable for a moderately prosperous society, adapting to the intelligent requirements of the power system, comprehensively enhancing two-way interaction between power sources and users, and supporting the construction of high-efficiency intelligent power systems.

　　4. Regarding comprehensive regulation capacity. Strengthen the construction of system peak-shaving capabilities and improve system flexibility. Multiple measures should be taken from the load side, power generation side, and grid side to fully tap the existing system peak-shaving capabilities, increase the planning and construction efforts for peak-shaving power sources, optimize power dispatch and operation, and greatly improve the responsiveness of power demand. During the "13th Five-Year Plan" period, the installed capacity of pumped storage power stations increased by about 17 million kilowatts, reaching about 40 million kilowatts. The scale of flexible transformation of combined heat and power units and conventional coal-fired power plants reached about 133 million kilowatts and 86 million kilowatts, respectively.

　　5. Regarding energy conservation and emission reduction. Strive to eliminate more than 20 million kilowatts of backward thermal power generation capacity. The average coal consumption per kilowatt-hour of newly built coal-fired power generation units is less than 300 grams of standard coal/kWh, and the average coal consumption per kilowatt-hour of existing coal-fired power generation units after transformation is less than 310 grams of standard coal/kWh. The comprehensive line loss rate of the power grid is controlled within 6.5%.

　　6. Regarding the guarantee of people's livelihood electricity. During the "13th Five-Year Plan" period, based on air pollution control, using electricity to replace scattered coal and oil burning as a lever, continuously improving the proportion of electricity in terminal energy consumption, accelerating the construction of charging facilities, promoting centralized heating, gradually replacing small coal-fired boilers, actively developing distributed power generation, and encouraging the efficient use of energy nearby. The centralized heating rate of large and medium-sized cities in the north will reach more than 60%. It needs to be emphasized that: during the "13th Five-Year Plan" period, we will take advantage of the opportunity of a new round of rural grid upgrading and transformation to comprehensively solve problems such as low per-household power supply capacity, multiple safety hazards, and "low voltage" in rural power grids, especially the weak power supply problems in villages and remote areas. At the same time, implement the photovoltaic poverty alleviation policy well, establish a long-term and reliable project operation management mechanism and poverty alleviation benefit distribution management system, and effectively achieve "precise poverty alleviation, effective poverty alleviation". In addition, according to local conditions and combining resource characteristics, encourage power enterprises to fulfill their social responsibilities, construct power projects in poor areas, and give priority to power projects in poor areas in power planning.

　　7. Regarding the development of science, technology and equipment. Apply and promote a batch of relatively mature new technologies with market demand, and quickly achieve industrialization. Experimentally demonstrate a batch of applicable technologies that have accumulated experience but have not yet achieved large-scale production, further verifying the technical route and economic efficiency. Focus on tackling key technologies with broad prospects but limited by core technologies. Encourage enterprises to increase R&D investment and actively participate in independent innovation. The "Plan" has made arrangements for the research and application of technologies such as ultra-low emission technology for large coal-fired power plants, photovoltaic system integration and control technology, application and promotion of offshore intelligent wind turbines, high-temperature gas-cooled reactor demonstration projects, and multi-terminal flexible DC transmission.

　　8. Regarding power system reform. Establish relatively independent and standardized power trading institutions, establish fair and orderly power market rules, and initially form a well-functioning power market. Deepen the reform of streamlining administration and delegating power. First, determine the transmission and distribution prices. Before the end of 2017, complete the determination of the total allowable revenue and transmission and distribution prices for grid enterprises at different voltage levels, and gradually reduce cross-subsidies in electricity prices. Second, establish and improve the power market system. Establish a standardized power market trading technical support system, actively cultivate qualified market entities, improve trading mechanisms, and enrich trading varieties. In 2016, a pilot program for the ancillary service market in Northeast China was launched, and it will be fully promoted after maturity. Before the end of 2018, pilot spot trading will be launched; in 2020, the spot trading market will be fully launched, and risk hedging mechanisms will be studied. Third, establish relatively independent and standardized power trading institutions. Fourth, orderly deregulation of power generation and electricity use plans. Before 2020, gradually cancel non-regulatory power generation plans except for preferential power generation rights. Fifth, fully promote the reform of the distribution and sales side of electricity. Before the end of 2018, complete the cultivation of market entities in the sales side of electricity.

　　In addition, the plan also deploys the principles of openness, inclusiveness, differentiated policies, and win-win cooperation during the "13th Five-Year Plan" period, making full use of both domestic and international markets and resources, and focusing on promoting international cooperation in power equipment, technology, standards, and engineering services. The "Plan" has detailed descriptions of the key tasks and major projects for power development in the next five years, and clarifies them through special columns. I will not repeat them here.

　　IV. Implementation of the Plan. The "Plan" requires that all provinces (autonomous regions and municipalities) should include the binding indicators, main tasks, and major projects determined in the "13th Five-Year Plan" for Power Development into their regional energy development plans and special plans for power development, and break down and implement target tasks, clarifying the schedule and target assessment mechanisms, and carefully organizing the implementation. All power enterprises should give full play to the role of market entities and actively and orderly promote the preliminary demonstration of planned projects to ensure the smooth implementation of the plan.

　　That's all for my brief introduction. Now, welcome your questions, and my colleague and I will answer them.

　　Reporter: Hello leaders, I'd like to ask about our considerations regarding power grid construction during the "13th Five-Year Plan" period. Thank you.

　　Han Shui: I will answer this question. During the "13th Five-Year Plan" period, our power grid construction is mainly considered and planned from three aspects. The first is the construction of power transmission channels. We consider that power transmission channels mainly reasonably allocate outward transmission from energy-rich areas, and construct ultra-high voltage transmission and conventional transmission technology "West-to-East Power Transmission" transmission channels. In the process of constructing power transmission channels, the key considerations are firstly, resource richness, and secondly, the power source structure and peak-shaving capacity of the receiving end, and reasonably determine the receiving proportion and receiving structure. At the same time, while ensuring the sustainability of cross-regional power transmission, it meets the long-term needs of the receiving area and can also participate in the power market competition of the receiving area. During the "13th Five-Year Plan" period, it is planned to increase the "West-to-East Power Transmission" transmission capacity by 130 million kilowatts.

　　The second consideration in power grid construction is the optimization of the regional main grid framework and the strengthening of inter-provincial connections. Further adjustments and improvements to the regional power grid will enhance the coordination of power grids at various voltage levels, strengthen the mutual assistance capabilities of inter-provincial power grids within the region, improve power grid operation efficiency, and ensure the safe, stable operation of the power system and the reliable supply of electricity. At the same time, the planning also requires strict control of power grid construction costs. As I mentioned earlier, the "Thirteenth Five-Year Plan" added 92,000 kilometers of 500 kV and above AC lines nationwide, and a substation capacity of 920 million kVA. During the "Thirteenth Five-Year Plan" period, the principles of hierarchical zoning, clear structure, safety and controllability, and economic efficiency were adhered to, and the national synchronous grid pattern was fully demonstrated in accordance with the requirements of the "Power System Safety and Stability Guide".

　　Thirdly, regarding the construction of distribution networks, we need to increase investment in distribution network construction to basically complete the construction of a modern distribution network that is in line with a moderately prosperous society. In the construction of distribution networks, we adhere to the principles of coordinated urban and rural development, safety and reliability, economic efficiency, advanced technology, and environmental friendliness. The intelligent construction and application level of distribution networks in central cities will be significantly improved, and the indicators of urban and rural power supply reliability and voltage qualification rate will be significantly improved. At the same time, our distribution network construction also provides strong support for effective measures such as electricity substitution, electric heating, port shore power, and charging facilities.

　　Reporter: Please explain the meaning of "reasonable level" in the context of keeping the implementation of the full-cost-recovery system within a reasonable level. Second question, coal-fired power generation is controlled at 1.1 billion from 900 million, an increase of 200 million in absolute terms. This absolute increase is still the largest among all development structures, for example, others are within 100 million. So where is this 200 million of thermal power mainly distributed? What is the impact of developing so much thermal power on gas and wind power?

　　Han Shui: Thank you for your question, which hits the core of our plan. The first question is how we propose to control our renewable energy, including wind and photovoltaic power, at a reasonable level? What measures do we have? I will also talk about this here. The second question is about how to control coal-fired power generation, how to control it at 1.1 billion, and how the proportion allocation with other new energy sources is considered. We will ask Director Xue Nong to answer this next. Let me answer the first question first.

　　Regarding wind and photovoltaic power, as you know, the phenomenon of water, wind, and light abandonment is quite serious now. Our "Thirteenth Five-Year Plan" aims to address the problems currently existing in the operation of the power system, including wind and light abandonment. The main reasons for wind and light abandonment, we analyze, are: firstly, layout reasons; secondly, power grid transmission reasons; and thirdly, system adjustment capacity reasons.

　　First, in terms of the layout of wind and photovoltaic power, we need to optimize it during the "Thirteenth Five-Year Plan." In areas with wind and power abandonment, we should develop in an orderly manner and appropriately slow down the scale and pace; second, we should adhere to the principle of combining centralized and decentralized construction, giving priority to on-site consumption, and promoting on-site consumption of photovoltaic power.

　　The second issue is to make the best use of the power grid for the development of renewable energy. Power grid construction, firstly, involves long-distance transmission. We are focusing on increasing the external transmission capacity of renewable energy power generation by utilizing existing planned transmission channels. During the "Thirteenth Five-Year Plan" period, we will use the West-to-East power transmission channels to increase the external transmission of 40 million kW of renewable energy power generation. At the same time, we are also increasing the transformation efforts in distribution network construction, hoping to further improve the level of intelligence through distribution network construction, so that renewable energy can be integrated into the system in the form of distributed generation and microgrids for on-site consumption. We will strengthen the capacity for accepting and consuming renewable energy through power grid construction.

　　The third feature of this plan is to comprehensively enhance the flexibility of the system and improve the peak-shaving capacity of the power system. The peak-shaving capacity of the power system is improved from several aspects. First, we need to increase the construction scale of peak-shaving power sources. The first is pumped hydro storage. During the "Thirteenth Five-Year Plan" period, 17 million kW will be completed, and 60 million kW will be started during the "Thirteenth Five-Year Plan" period; second, some peak-shaving gas-fired power generation will be constructed. We plan to deploy about 5 million kW of peak-shaving gas-fired power generation; third, we will increase the flexibility transformation of coal-fired power plants and increase the peak-shaving capacity of coal-fired power generation. During the "Thirteenth Five-Year Plan" period, we plan to transform 133 million kW of combined heat and power units and 86 million kW of pure condensing units, mainly to increase the peak-shaving capacity in the "Three North" region. These are the arrangements we have made to increase peak-shaving capacity.

　　The amount of peak-shaving capacity we have added is optimized through system engineering methods. Our optimization indicator is to control the local wind and light abandonment rate at a reasonable level, which is to strive to control it within 5%. This 5% is a common control indicator, but the situation varies from region to region, so we use "control at a reasonable level" to express it. Appropriately abandoning wind and light power allows for greater consumption of renewable energy power generation and supports the larger-scale development of wind and photovoltaic power. At the same time, to cooperate with these policies, we also propose that the power grid should be strengthened and optimized, and the load should strengthen the efforts of electricity substitution, especially using off-peak electricity for substitution, especially using off-peak surplus electricity for electric heating consumption. At the same time, we are studying and promoting peak-valley electricity pricing policies, promoting various auxiliary service markets, etc. Through the simultaneous implementation of hardware and software construction, and multiple measures, we can ensure the healthy and orderly development of renewable energy. And I suggest that it is better to use "reasonable level", because around 5% is the result of our optimization.

　　Reporter: Control at a reasonable level? Or reduce it?

　　Han Shui: It will definitely be a significant reduction compared to the current wind and light abandonment rate. It increases the consumption of wind and solar power and can basically guarantee the profitability of wind and solar power.

　　Huang Xuenong, Director of the Electricity Department of the National Energy Administration: Let me answer the second question. In recent years, our economic development has entered a new normal, economic growth has entered a medium-high speed, and everyone has seen the trend of slowing down in electricity supply and demand. Coal-fired power generation, as our country's main power source, also faces some new challenges in its development, with slowing demand. The national electricity consumption growth rate has dropped from 12% in 2011 to 0.96% in 2015, a significant drop. The expected electricity consumption growth rate during the "Thirteenth Five-Year Plan" is 3.6%-4.8%, which is also a decrease compared to 12% in 2011. Second, the energy structure is further optimized. Since the "Thirteenth Five-Year Plan", the proportion of coal in China's energy consumption has dropped from 69.2% in 2010 to 64% in 2015. China has pledged that the proportion of non-fossil energy consumption will reach about 15% and 20% in 2020 and 2030 respectively. In the future, coal-fired power generation will continue to make room for the development of non-fossil energy.

　　Third, the potential risk of coal-fired power generation overcapacity is gradually emerging. As everyone knows, the growth rate of electricity demand is slowing down. The utilization hours of thermal power generation have dropped from 5021 hours in 2013 to 4329 hours in 2015, a significant decrease. This year, it is expected to be around 4000 hours, and in the following years of the "Thirteenth Five-Year Plan", we expect this number of hours to further decrease. Currently, there are still many coal-fired power generation projects planned and under construction in various places, and the potential risks of coal-fired power generation are prominent. Therefore, the plan proposes to "strive to control it at 1.1 billion", which still requires policy measures to be implemented to achieve.

　　Currently, we have several measures in place. Firstly, we are implementing a risk warning mechanism for coal-fired power generation construction planning, categorized into red, yellow, and green alerts. This warning mechanism effectively guides the planning and construction of coal-fired power generation in various regions. Secondly, we are adopting measures such as delaying the approval and construction of projects that have already commenced or been approved for construction. Thirdly, we are eliminating outdated production capacity. Through these measures, it should be possible to control coal-fired power generation within 1.1 billion kilowatts during the 13th Five-Year Plan period, while also ensuring the needs of economic and social development. We predict that electricity demand during the 13th Five-Year Plan period will be in the range of 6.8 to 7.2 trillion kilowatt-hours, which also takes into account the principle of appropriate advance planning for power construction. This will effectively guarantee the electricity demand for current economic and social development; avoid excess electricity; and keep the utilization hours of coal-fired power generation at a reasonable level.

　　Reporter: After listening to the introductions from the two leaders, I am very encouraged by the efforts to control the curtailment rate of wind power at a reasonable level and strive to eliminate more than 20 million kilowatts of outdated coal-fired power generation capacity. I would like to ask the leaders to introduce the main goals of electricity substitution during the 13th Five-Year Plan. Also, I looked at the report and listened to Mr. Han's introduction. Does our current plan indicate a priority development policy for clean energy? I also have another question: What is the significance of promoting electricity substitution for China's energy structure adjustment, response to climate change, and environmental governance? Thank you.

　　Han Shui: These are two separate questions, thank you for your question. Regarding electricity substitution, please let Director Xue Nong answer. I will answer how the principle of prioritizing the development of new energy is reflected in the plan.

　　Huang Xuenong: The issue of electricity substitution is, in the plan, a principle of building a modern energy system that is clean, low-carbon, safe, and efficient. Electricity substitution is also a very important consideration in the plan. We believe that promoting electricity substitution is of great significance, as the reporter just mentioned, involving environmental protection and other issues. The current situation of air pollution is very severe. The haze in Beijing these days is clear to everyone; this morning it seems a little better. I believe that a major factor contributing to the current haze is the large amount of scattered coal and crude oil consumption. According to statistics, our country consumes about 700-800 million tons of scattered coal annually, accounting for 20% of our total coal consumption. This is a considerable amount, mainly from small heating boilers, small industrial boilers, and some rural production and living areas. Compared with the United States and the European Union, the 20% level of scattered coal consumption is quite high. A large amount of scattered coal is burned directly without being cleaned, resulting in the emission of a large amount of air pollutants. This is the main background for our consideration of electricity substitution.

　　This includes current automobiles, airport auxiliary power units, and the use of fuel by berthed ships. We have also held consultations with relevant departments such as the Ministry of Transport on this issue, which is also a major source of air pollution emissions. Electricity has the advantages of being clean, safe, and convenient. Implementing electricity substitution is of great significance for promoting the energy consumption revolution, implementing the national energy strategy, and promoting the clean development of energy. As Mr. Han mentioned earlier, a large part of the electricity for electricity substitution comes from renewable energy, which can also make better use of renewable energy. Secondly, in recent years, coal-fired power generation has greatly reduced its emissions through energy-saving and environmental protection renovations. Whether the electricity used for electricity substitution is generated from renewable energy or coal-fired power generation, replacing scattered coal combustion will make an important contribution to reducing air pollutant emissions.

　　In the 13th Five-Year Plan, the target we set for electricity substitution is 450 billion kilowatt-hours. According to this target, by the end of the 13th Five-Year Plan, electricity will account for 27% of terminal energy consumption. The significance of electricity substitution is enormous; it is a key task of the plan, which will help improve our country's electrification level and allow the people to enjoy more comfortable, convenient, and intelligent electricity services. In addition, electricity substitution will further expand our electricity consumption and alleviate the problem of excess electricity and system peak regulation in some regions, especially the serious problem of "electricity hoarding" in some areas. The significance of these aspects is very important.

　　Han Shui: I will briefly answer the reporter's question about how to reflect the principle of prioritizing new energy in the plan. As everyone knows, conventional power planning is mainly based on two principles: one is to meet the predicted load demand and ensure power supply; the other is to determine the construction scale and types based on economic efficiency. In order to highlight the requirements of energy structure transformation and upgrading, this plan adds a key principle, which is the third principle—by 2020, the proportion of non-fossil energy consumption in primary energy consumption will reach about 15%. This time, we set this target as a hard target that must be achieved. Therefore, we must fully reflect this in the plan. In the process of optimizing the power structure, we prioritize the layout of clean energy. When balancing electricity and power, we first balance hydropower, wind power, photovoltaic power, and nuclear power, and then see if these power sources can meet the electricity demand. The shortfall will then be supplemented by gas-fired and coal-fired power generation. According to calculations, this prioritized layout of clean energy will meet the requirement of reaching 15% of non-fossil energy consumption by 2020 and ensure that China's solemn commitments to the world are fulfilled. This is a very important principle throughout the entire plan.

　　Prioritizing the use of renewable energy power generation is also reflected in, for example, maximizing the consideration of clean energy transmission in long-distance power transmission channels. In the West-to-East power transmission, there are also plans for the construction of transmission channels in regions rich in renewable energy, including hydropower-rich regions and wind power-rich regions. In terms of consumption, we have also introduced various policies to encourage the consumption of renewable energy. We have made great efforts in both hardware and software to improve the consumption capacity of renewable energy, control the curtailment rate of wind and solar power at a reasonable level, and reflect the main line of green development in the plan.

　　Reporter: I am very happy and encouraged to hear about the priority development of new energy. I would like to ask, there are so many types of new energy, what proportion of new energy will be developed in the future, or which type of new energy will be prioritized? Also, at the recently concluded Energy Transformation Forum, we learned that many experts and participants said that new energy, especially photovoltaic energy, has entered the era of grid parity. Many companies are worried about whether the development of photovoltaics will be affected, such as the cancellation of subsidies. I would like to ask if there is a plan for the future development of new energy? Thank you.

　　Han Shui: Thank you for your question. This plan is actually a comprehensive and coordinated plan for electricity, mainly reflected in coordinated development. Regarding photovoltaics, especially renewable energy, we have some special plans, including renewable energy plans, wind power plans, photovoltaic plans, hydropower plans, biomass plans, and other special plans. These plans will specifically answer your questions about the future policies, scale, and detailed layout of photovoltaics. In the electricity plan, the main focus is on coordinating the total amount, layout, and transmission, and coordinating new energy and renewable energy in the overall development of electricity. The specific development issues of photovoltaics will be determined in the special plans.

　　Reporter: During the 11th and 12th Five-Year Plan periods, the national level did not issue a unified electricity development plan. What is the significance of issuing an electricity development plan during the 13th Five-Year Plan?

　　Han Shui: Due to various reasons, the national level did not issue a unified power development plan during the 11th Five-Year Plan and the 12th Five-Year Plan periods. The power industry is a basic industry related to national economy and people's livelihood. Ensuring power supply is related to national security and the overall economic development. At the same time, the 13th Five-Year Plan is also a decisive period for China to fully build a moderately prosperous society. Domestic economic development has entered a new normal, and the hard constraints of environment, ecology, and resources are constantly strengthening. The supply and consumption structure of energy has also entered a period of profound adjustment, and the power industry faces new opportunities and challenges. Therefore, it is very necessary and timely for us to compile and issue the 13th Five-Year Plan for electricity. The compilation and release of the Plan is mainly the practical action of the power industry to implement the development concept of "innovation, coordination, green, openness, and sharing" of the CPC Central Committee and the State Council, and the energy development strategy of "four revolutions and one cooperation"; it is an important step to implement power system reform, streamline administration and delegate power, and strengthen planning guidance; it is an important measure for the power industry to seize opportunities, meet challenges, coordinate overall, achieve sustainable development, and achieve a moderately prosperous society; it is an important part of the implementation of the 13th Five-Year Plan for National Economic and Social Development and the 13th Five-Year Plan for Energy Development. Therefore, we believe that the significance of this plan is very significant.

　　Reporter: I saw in the Plan that the growth rate of electricity consumption for the whole society during the 13th Five-Year Plan period is 3.6%-4.8%, but last year's growth rate of electricity consumption for the whole society was 0.5%. Although the growth rate in the first three quarters of this year reached 4.5%, due to some abnormal weather conditions this year, the data is not comparable. So, is the setting of this data a little optimistic? How did you consider it? Also, regarding coal-fired power generation, less than 1.1 billion, but many reports are saying that the currently under-construction coal-fired power generation capacity is already 1.9 billion. How can we keep it within 1.1 billion?

　　Han Shui: Let me answer the first question. Now, our planning of electricity demand forecasting is a very important link and a foundation. It is very difficult to accurately predict the electricity demand for the next five years during the 13th Five-Year Plan. Our planning actually started two years ago. The difficulty of accurately predicting the demand in 2020 is indeed very great, and we are also very cautious. The National Energy Administration decided to adopt multiple methods for forecasting and listen to opinions from all sides. First, we commissioned several consulting agencies and well-known universities, based on the overall requirements of building a moderately prosperous society in an all-around way, and cooperating with the economic data of the moderately prosperous society, especially implementing the requirements of the national economic and social development plan outline; at the same time, we also referred to relevant countries and regions abroad, the economic development speed at our same stage, and their electricity growth at that time. In addition, we also conducted detailed analysis of the future industrial structure adjustment, optimization layout, and transformation and upgrading in different regions. At the same time, combining these factors, we adopted conventional and modern forecasting methods to predict the electricity load demand in 2020.

　　We also listened to opinions from all relevant parties. After repeated demonstration by relevant power enterprises and experts, we reached a consensus on the total electricity consumption of the whole society reaching about 7 trillion kWh in 2020. This expectation is acceptable to all parties. Considering the uncertainty of economic growth, therefore, in this power plan, we did not give a single number, but used an interval to predict. Within this interval is 6.8-7.2 trillion kWh. Considering that the construction of electricity takes some time, for example, everyone cares about thermal power and coal-fired power generation, the construction period from planning to construction is generally about three years. Considering the uncertainty of electricity growth, we also need to consider the priority of electricity and ensure the power supply. In the plan, we also reserved 200 billion kWh as a development reserve (reserve projects, not under construction, can be started at any time). In this way, multiple measures are used to adapt to the uncertainty of electricity demand growth.

　　Huang Xuenong: Thank you for the reporter's question. The target of 1.1 billion is not easy, but there are several considerations for setting this target. Considering energy saving and emission reduction, meeting electricity demand, and the reasonable utilization hours of coal-fired power generation, we believe that 1.1 billion can both guarantee power supply and demand and control the utilization hours of coal-fired power generation at a reasonable level. However, how can this be done? As you just mentioned, according to the projects that have already started, been approved, and are under construction, by the end of the 13th Five-Year Plan, if not controlled, it will reach more than 1.25 billion. Here, we clearly propose that during the 13th Five-Year Plan, we will control the existing capacity by 150 million, so it will be less than 1.1 billion.

　　Three measures are adopted, which I have also mentioned. First, the risk warning mechanism for the planning and construction of coal-fired power generation is very strict. Red areas are absolutely not allowed to be built or approved. Now, there are very few green areas, only a few provinces nationwide. Since last year's implementation, the effect has been very obvious. Second, the measures of "Canceling a batch, delaying the approval of a batch, delaying the construction of a batch" are adopted. Third, eliminating backward production capacity. Director Han just mentioned 20 million kW, which is our conservative estimate. However, in the past few years, the government has made great efforts in this regard, and most of the easy-to-eliminate ones have been eliminated. The remaining ones are hard bones, but this still needs to be done. Whether it's energy saving or emission reduction, from all aspects, the elimination of backward production capacity is necessary. According to the situation of existing backward units, therefore, we set a target of 20 million kW. Through these measures, we strive to control the installed capacity of coal-fired power generation at 1.1 billion in 2020.

　　Liang Changxin: Friends from the news media, we sincerely welcome you to pay attention to and support the development of the power industry and create a good situation for jointly promoting the transformation and upgrading of the power industry. Due to time constraints, we cannot answer all your questions at today's press conference. Next, we will continue to promote and interpret the "13th Five-Year Plan for Power Development" in various forms. We hope that you can help us do the relevant work. Today's press conference is now over. Thank you!