China gas and power month in brief: what's the story behind strong demand?
China gas demand grew 9.6% year-on-year in Q1. LNG imports continued to perform well, but there was a decline in volumes imported from Central Asia. Power demand also grew above expectation in March, supported by a revival in heavy industrial activities. To further boost gas demand, China cut industrial end-users’ gas prices in Shanghai and scaled back natural gas VAT rate from 13% to 11%. On the supply side, CNOOC’s Yuedong LNG terminal received its commissioning cargo, though still far from being able to supply gas to the pipeline. Elsewhere the SNEC event in Shanghai shows that China is leading the latest industry trends across the entire solar PV value chain through continuous technological innovation. In contrast to the booming solar power industry, coal power generators continue to face pressure – the Big Five state-run generators reported a 40% of profits drop in 2016 due to the coal price rally since the second half of last year.