We have revised upward our long term China power demand forecast. There are two reasons for the change. Firstly the government increased its power demand numbers for 2015. Secondly stimulus around infrastructure construction pulled up heavy industrial output which led to stronger power demand in 2016 and 2017. But these short term gains are at the cost of long term pains in which growth potential is overdrawn. The downtrend in the longer term will become more evident with the accelerating transition towards services in the economy. We continue to see China's environmental policies reshaping its energy supply options. Excess coal fired capacity will be eased but low utilisation will follow once these projects are completed. Gas power is increasingly favoured as a way to combat air pollution and smooth out intermittent renewable output. Curtailments to wind and solar generation will remain in the near term with waves of projects coming onstream.