The company's profit increased by 8.9 percent to 10.5 billion yuan (US$1.27 billion) last year, with turnover of 347.7 billion yuan (US$42.1 billion).

The State Power Corp, which controls half of the nation's power plants and almost all the electricity grids, sold 955 billion kilowatt hours of electricity, increasing by 8.3 percent year-on-year. Over 20 percent of the electricity sales volume was generated by its plants.

The increase in electricity consumption is attributed to the country's steady economic growth - the gross domestic production (GDP) rose 7.3 percent last year.

Power consumption in industries such as textiles, metals, communications equipment and construction materials has maintained a two-digit increase rate, analysts said.

The company, which is widely believed to have shed some of its power plants in the government's proposed reform package, put more efforts into investing in its electricity grids last year.

It invested 103.3 billion yuan (US$12.5 billion) in its grid construction, accounting for 66 percent of its total fixed assets investment, last year.

It invested 107 billion yuan (US$12.9 billion) in upgrading the grids in rural and urban areas last year, in a bid to improve the safety and efficiency of the grids.

The company said the improved electricity grids have helped lower the price of electricity in rural areas, which in turn stimulated electricity consumption in villages.

Electricity in China's rural areas is usually more expensive than in cities because of longer transmission distance and more use of the grids.

The scheme has helped residents in rural areas slash electricity costs by 35 billion yuan (US$4.2 billion).

Also, the State Power is speeding up its west-east electricity transmission project, which aims to transport more clean and cheap electricity from the western areas to the power-thirsty east regions.

Of the new electricity generation projects kicked off last year, 72 percent were located in the west. Among them, 42 percent were hydropower projects.

China aims to use more hydropower from the west to replace the coal-fired power plants in its east coastal areas, thus improving the area's environment, and to develop its underdeveloped west regions.

Last year, the company was approved to issue corporation bonds worth 4 billion yuan (US$483.6 million), to fund its west-east electricity transmission project.

(China Daily January 17, 2002)