China to splurge CNY1trn on 8 UHV transmission lines

To be completed between 2013 and 2021.

Fitch Ratings has said that the Chinese government's recent measures show that it is taking a more systematic approach in developing sources of renewable and clean energies in the country.

The government has focused on not only increasing the capacity for renewable energy generation, but also enabling higher utilisation of that capacity.

It will do so by exerting greater central control over the country's renewable energy capacity and by increasing investments in the power grid to enable the deployment and employment of these clean energies.

State Grid Corporation of China (SGCC; A+/Stable) has said it will spend more than CNY1 trn (USD162.8bn) between 2013 and 2021 to building eight Ultra High Voltage (UHV) transmission lines across China. This investment demonstrates SGCC's role as a policy tool to advance the government's initiatives and the country's commitment to effectively deploy electricity generated by renewable and clean sources that are often located far from consumers.

China has been investing in the research and development of UHV transmission because traditional technology results in significant losses when electricity is transmitted over long distances.

Use of UHV transmission would enable clean energy producers to close the gap between consumption and resource centres and help China maintain its coal-fired generation capacity, which Fitch expects will be increasingly located further away from cities and closer to coal resources.