Power & Energy
China’s energy consumption and economic output have both increased by over 400 percent since the early 1980s. Like the broader economy, the energy sector has witnessed significant change as new technologies, policies and commercial strategies address the torrentially increasing demand from society.
Summary of Market Size Figures (Bn RMB)
Power generation and transmission was a part of the Ministry of Power from 1949 to 1997. During the 1980s, amid chronic brown outs, power plants were built at a rate of four to five per week. In 2002, power production and transmission were separated, with the creation of the “Big Five” plant holding companies, the State Grid Corp and China Southern Grid corp. Central investment in China’s power sector has been heavily focused on power production, with approximately 50% more fixed asset investment in the Big Five than in the Grid Co’s. This has led power grids to grow out of power plant planning and not as a planned structure in their own right. As such there is very little long distance transmission, load control or automation in China’s power grids.
Most of the major global companies participate in China’s power and energy sector, typically with local partners. Conoco-Philips, for example, helps CNOOC access deep water drilling sites; Areva is assisting with the construction of nuclear power plants; and ABB works with power groups to produce T&D products such as switchgear and substation automation (a prelude to the smart grid).
Recently, alternative energy has been recognized as a vital part of China's future spectrum of energy sources. The alternative energy sector has grown quickly but outside of state-controlled hydro and nuclear programs; alternative energy sources such as wind, bio-mass and solar make up less than one percent of all capacity. High technology solutions for solar power modules, wind turbines, and a wide range of “smart” T&D products will continue to be highly sought after.
Below is a list of products that GCiS have experience in. Target products are not limited to this list.
- Alternative energy, including solar, wind, WTE
- Battery Technology
- Fuel cells
- Natural gas, including LNG distribution
- Retrofit of boilers, turbines
- Smart meters and other smart grid systems
- Switchgear, including GIS
- Transformers, power terminals and other T&D
Client Needs & Project Background
An American supplier of specialized digital power transmission products had entered the China market, though given the complexities of power markets in China was not entirely clear on how to best develop its market. Its products are used in the power grid to both monitor power surges, cut off the circuits, and communicate with other nodes in the grid. These form one component of the “Smart Grid,” which is still in its incipient stages in China, and seeing uneven development. The client needed to understand how this market was developing, and how to best take advantage of this.
This project was strategic in nature, and was in part a feasibility study, as the market is yet to enter its growth phase. The research had a particular focus on the demand-end of the market, meaning customers and influencers. For the power grid, this means different levels of power bureaus- with the main focus on regional and large municipal. This also included associated power design institutes, which play a major role in designing the architecture for these systems and specifying technology, as well as a set of system integrators specialized in T&D. The research showed that first, the client would have to get buy-in from these major influencers including design institutes and others before the power bureaus will consider these products. Secondly, the client would have to have a localized service and integration team that would work with the customers and integrators who lacked familiarity with the products' specifications. A well targeted education campaign would also have to be imported. GCiS then recommended a step-by-step plan to best enact this process.