China gas and power month in brief October 2017: gas demand surge continues
Coal-to-gas switching plays a critical role in China's massive gasification programme. The '2+26' policy alone could bring an additional 10 bcm of demand this winter. As local governments push harder to meet the deadlines for switching, the market is increasingly expecting a shortfall of gas supply. The NDRC has already urged local governments and gas suppliers to manage increasing risks of supply disruptions. On the power side, we are expecting hydropower output to grow strongly – to the detriment of coal generation. The blueprint for developing energy storage will further shift the way power systems have been operated, putting coal power in an increasingly difficult position in the mix.