Power consumption is a closely watched early indicator of the vitality of China's economy, because so much of the country's growth relies on power-intensive industries such as steel, aluminum and chemicals. Power consumption closely tracks the true pace of industrial activity since industries account for 74 percent of the total.
As many factories like Chengda resume production at part or full capacity, China's power consumption has picked up gradually in the last two months, in one of the key indicators that economists and officials said the Chinese economy had bottomed out.
The China Electricity Council (CEC) announced on April 14 that power consumption stood at 283.4 billion kilowatt-hours in March, a drop of 2.01 percent from a year earlier, but a jump of 15 percent from February's 245.5 billion kilowatt-hours.
In the first quarter, power consumption totaled 781 billion kilowatt-hours, down 4.02 percent from a year earlier, a milder decline than the 5.22 percent year-on-year slump in the first two months.
The CEC figures show China's monthly power consumption began to contract in October last year, when the country consumed 269.9 billion kilowatt-hours, a decline of 3.7 percent year on year.
In the following two months as the global financial crisis hit harder, the downward pace of demand accelerated. In November, consumption was 256.2 billion kilowatt-hours, down 8.6 percent, and in December it was 273.7 billion kilowatt-hours, a drop of 8.93 percent.
Wang Zejun, an industry analyst with Beijing-based Huarong Securities, said consumption rose in February and March as construction began on many projects in the 4-trillion-yuan stimulus plan.
It was also a result of a series of aggressive measures taken by the government to stimulate the economy, including export tax rebates, which allowed Chengda Belt to raise profit margins while slightly cutting prices.
