China needs a more powerful energy agency
3/12/2004 11:32
China's central government needs a more powerful agency to oversee the
country's energy sector, Friday's China Daily quoted industrial experts as
saying. Currently the government has an Energy Bureau under the
ministry-level National Development and Reform Commission (NDRC). Critics
said the Energy Bureau, which only has a dozen staff members, is too weak and
inferior to oversee an energy industry that has total assets of more than 10
trillion yuan (1.2 trillion US dollars). China set up the Ministry of Energy
in 1988 but it was dismissed five years later because its administrative
function overlapped with other departments such as the then State Development
Planning Commission. The ministry was pointless to some extent as big oil,
power and coal companies also enjoyed administrative power at that
time. Facing increasing energy shortages, the government set up an Energy
Bureau under the NDRC during reform of the administration in March 2003. But
the bureau failed to curb the widespread energy crunch that broke out in late
2002. More than two-thirds of the country's territory has now suffered
frequent blackouts. Coal mines cannot keep up with the surging demand, while oil
imports is rocketing as the nation becomes the second-largest oil consumer in
the world. Industrial experts and officials said the bureau was not powerful
enough to co-ordinate relations between different sectors such as coal and
power. The two sectors fight frequently over coal prices, with many power plants
running out of coal stocks and shutting down. "In most cases, the Energy
Bureau is incapable of coordinating relations," said Wu Zhongwu, a senior
researcher with Energy Research Institute. The bureau is crippled because
much of the administrative power in the energy industry is scattered between
different government organs, Wu said. The pricing department of the NDRC, for
example, is in charge of setting energy prices, while the transport department
oversees oil and coal transport. Oil and coal imports and exports as well as
management of the oil markets are controlled by the Ministry of Commerce, while
the Ministry of Land and Resources steers resource exploration. Zhu
Chengzhang, a veteran energy expert, said the bureau lacks the staff and experts
needed to handle such a big industry. The bureau only has 20 some personnel
compared with more than 1, 000 employees in the Ministry of Energy in the United
States. The Energy Bureau is overwhelmed with specific issues such as project
approval, but neglects more important issues such as strategic planning, Zhu
said. "It should study what kind of economy we will develop, what kind of
energy we should use, how much should be imported, what are the possibilities
for imports.... These are strategic issues that need to be thought through," Zhu
said. Critics also said the bureau is too inferior, in terms of official
ranking, to connect with other countries to resolve China 's imports. Experts
are stressing the need to set up a more senior level energy department, either
an Energy Ministry or an Energy Committee, to oversee the industry. "The
power needs to be consolidated into one higher-level government department,"
Huan Guoyu, a researcher with a thinktank of the State Council Office for
Restructuring the Economic System, was quoted as saying. "It is conducive for
China to form a constant long-term energy policy." But experts agreed that to
reform the administration will be a touchy issue. It is difficult to reshuffle
the current administration and consolidate power.
Xinhua
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