Hydroelectric Power in China: IBISWorld Sees Big Growth in Small Hydropower Plants

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In the five years through 2012, revenue for the Hydroelectric Power industry has increased at an average annualized rate of 14.4% to $34.2 billion, reports IBISWorld. Drivers for industry growth have been power shortages, industry deregulation and the implementation of a market mechanism. Over the coming years, the development of small hydropower plants to supply renewable energy to rural areas where both the population and the power load are sparsely distributed, and where the existing electricity grid cannot easily or economically reach, will be increasingly important to the industry.

IBISWorld Market Research

IBISWorld Market Research

Only 25% of the China's exploitable hydroelectricity sources are currently being used for power generation.

In the five years through 2012, revenue for the Hydroelectric Power industry in China has increased at an average annualized rate of 14.4% to $34.2 billion, reports IBISWorld. The government's strategy for developing renewable energy in China has had a positive impact on the development of the industry. Additional drivers for industry growth have been power shortages, industry deregulation and the implementation of a market mechanism.

Hydroelectricity, as a replacement for thermal power generation in China, is less polluting and enhances the utilization ratio of resources. Currently, only about 25.0% of the total exploitable hydroelectricity sources are used for hydroelectricity generation. China has abundant water resources appropriate for small hydropower generation in over 1,600 counties spread over 30 provinces. These are mainly remote and poverty-stricken regions, where both the population and the power load are sparsely distributed, and where the existing electricity grid cannot easily or economically reach. Small hydropower plants (SHPs) have already become important energy suppliers and play a significant role in the overall economic development in these regions, says IBISWorld. However, small hydropower plants are disadvantaged compared with large generating enterprises due to a lack of operations and pricing support from local governments. Many of these small plants are therefore waiting for further beneficial policies to be developed.

Although market share concentration in the Hydroelectric Power industry remains low, it has increased substantially over the past five years following the construction of the biggest hydroelectricity project in the world, the Three Gorges project. The largest players, which also include Huanghe Hydropower Development Company, Wuling Electric Power Company, and Ertan Hydropower Development Company, are heavily investing in power capacity enlargement and the construction of new plants. In addition, some of them have started acquiring companies in other regions of the country.

For more information, visit IBISWorld’s Hydropower in China industry report page.

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IBISWorld industry Report Key Topics

The Hydroelectric Power industry in China comprises establishments that operate hydroelectric power generation facilities. These facilities derive energy from falling or flowing water, such as rivers, streams and the overflow of dams. The establishments in this industry produce electric energy and provide electricity to transmission systems or to electric power distribution systems.

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About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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