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China's thermoelectric heat supply accounts for 30% of the system needs to be further improved
In recent days, as temperatures have dropped significantly, thermoelectric companies across the country have ramped up their efforts to provide heating for the early winter season. Combined heat and power (CHP) systems have gained popularity in northern regions due to their energy efficiency and environmental benefits. However, they also face concerns related to fluctuating coal prices and evolving heating system models.
According to a report from the China Electricity Council, about 30% of central urban heating capacity in China comes from thermal power plants. During the "Twelfth Five-Year Plan" period, it is expected that the penetration rate of central heating in large-scale buildings in northern regions will reach an average of 65%, with CHP accounting for 50% of that share.
The issue of coal price linkage remains a key challenge. In the northeast region, heating prices have remained low for a long time, leading to situations where coal and heating prices are misaligned. With the cancellation of key coal contracts, regional thermal coal prices have risen, causing losses for many heating companies. For instance, Guodian Bei'an Thermal Power Company reported losses of 21.84 million yuan in 2010, 1.92 million yuan in 2011, and 45.97 million yuan in 2012. The company’s heating cost per kilojoule exceeds its revenue, creating a significant financial burden.
Experts suggest that heat price adjustments should be based on local conditions, taking into account costs and the interests of all stakeholders. They recommend implementing a coal-heat linkage mechanism and providing financial support to companies facing severe losses.
In Shandong Province, a draft regulation was submitted for review, proposing integrated heating systems that include heat sources, pipelines, and heat exchange stations. This approach aims to improve efficiency and reduce costs.
Thermoelectric companies are also exploring direct supply methods to households. For example, Huadian Energy Harbin Power Plant expanded its heating area by 1.2 million square meters during the 2013–2014 heating season. Similarly, Jiangsu Changshu Power Generation Co., Ltd. partnered with a development zone to build and operate a local heating network.
Experts believe that direct heat supply to residential areas could be a promising direction for the future. Some companies are already moving toward this model, reducing intermediate steps and lowering costs.
Central heating is increasingly favored by residents, with developers highlighting it as a selling point. In Harbin, for example, real estate projects using thermal power plant heating can command higher prices.
During the "Twelfth Five-Year Plan," the Ministry of Housing, Urban and Rural Development will focus on upgrading old pipe networks in northern cities, promoting the development of CHP-based heating. These initiatives align with national environmental policies, including the Air Pollution Prevention and Control Action Plan, which aims to phase out small coal-fired boilers and promote cleaner heating solutions.
Overall, the shift toward more efficient and environmentally friendly heating systems continues to gain momentum, driven by both policy and market forces.