China to break up state power monopoly; listings could raise 300-400 bln yuan

BEIJING (AFX-ASIA) - The government is to break up the State Power Corp electricity generating monopoly into several competing companies and a national grid operator which will be listed on stock exchanges at home and overseas, the China Daily reported, citing government officials.	    The listings could raise between 300-400 bln yuan, which could be used to fund the nascent social security system, a top priority under the current 10th five-year plan, Hu Angang, director of the Research Centre for China Study under the Chinese Academy of Sciences, was quoted as saying.	    Under plans being formulated by the government, the State Power Corp, which controls nearly half the country's generation assets and all its high-voltage grid assets, will be broken up into several companies, Wang Jun, director of the Power Department of the State Development Planning Commission was quoted as saying.	    The SPC will become the country's sole grid operator and probably seek an overseas listing. It may retain some power plants to balance any volatility in supply and for national security reasons.	    The new power companies will operate nationwide. Instead of controlling generating assets in a particular region, they will take stakes in individual power plants, to avoid the creation of regional monopolies, Wang said.	    "These separated power plants will be merged, purchased or listed on the stock market gradually, to offload the state's shares in a bid to further stimulate competition," he said.  "A raft of power company listings is foreseeable."	    Wang said the reforms should attract more foreign capital into the sector.  Hu Angang said the power sector holds total assets of some 800 bln yuan, one sixth of all state-owned assets.	    If the state cuts its shareholding by half, it could raise some 300-400 bln yuan to supply the social security fund, he added.	    Last year, trial separations of plants and grids were launched in Shanghai and five provinces, including Liaoning, involving power plants bidding through a computerized auction system to supply the grid. 

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