Power use returns to positive growth, mirroring stabilizing economy

China's social power consumption increased 1.9 percent on year in August, returning to positive growth from a year-on-year decline of 1.3 percent in July and a year-on-year increase of 1.8 percent in June, according to data released by the National Energy Administration (NEA) on Tuesday.

The recovering power use growth mirrors a stabilizing economy and the improving power use structure suggests that the economy structural adjustment is gradually taking effect, experts say. The growth of the power use, which is regarded as a barometer of the macro-economy, has been wiggling up since the beginning of this year.

It was negative in February and March, but became positive in the second quarter of this year.

The volatility of power use in July was mainly caused by such factors as the weather that had impacted industrial production and the positive growth in August showed that the economy is gradually stabilizing, Shan Baoguo, a researcher with State Grid Energy Research Institute, said.

Meanwhile, the mix of electricity consumption has also changed, with power consumption in tertiary industry going up by 7.8 percent year on year in August, 3.4 percentage points higher than the growth in July.

As compared to the mild growth of 0.7 percent in power use of the secondary industry, tertiary industry power use showed a strong growth and thus took a larger share in total social power use in August.

This is actually a continuation of the power use trend since this year with the tertiary industry taking the place of the secondary industry to become the growth engine of power use.

Statistics show that the proportion of power use by secondary industry in total social power use went down 1.2 percentage points year on year in the first half of this year, while that by tertiary industry went up 0.8 percentage points.

Also, within industrial sector, power use by the four energy intensive industries including chemical raw material product, non-metallic mineral products, ferrous metal smelting, and non-ferrous metal smelting dropped 2 percent year on year from January to July, which was 6.7 percentage points lower than the growth in 2014, according to experts with China Electricity Council (CEC).

Such a power use growth differentiation further indicated the country is deeply pushing forward the industrial structural adjustment, by slowing the traditional energy intensive industries and accelerating high-end equipment manufacturing industries, Shan Baoguo noted.

Social power generation and consumption are expected to maintain growth considering current power operation, according to an official with the National Development and Reform Commission.

China's social power use is likely to grow 2-4 percent year on year for the full year of 2015, predicts the CEC.