(Yicai) March 28 -- Hunan Energy Investment Group, which was formed by the government of China’s central Hunan province yesterday, will invest more than CNY100 billion (USD14 billion) over the next seven years to guarantee the province’s electricity supply.

Hunan Energy, formerly known as Hunan Xiangtou Holding Group, will be responsible for implementing the province's energy development strategy, ensuring electricity supply and developing sources of energy, Yicai learned.

To achieve this, Hunan Energy will make large-scale investments from now until 2030. By 2025 the Changsha-based group will operate more than 10 million kilowatts of installed electricity, accounting for more than 10 percent of the province’s total, which will then increase to 22 million kW by 2030, accounting for 20 percent.

Hunan has been facing challenges in terms of electricity supply, especially during the hottest and coldest times of the year, due to a shortage of fossil fuels such as coal and natural gas. It is therefore necessary to set up a provincial energy company to ensure the uniform allocation of resources, an insider said.

Hunan Energy has increased its registered capital to CNY30 billion (USD4.2 billion) from CNY15 billion. Its previous entity Xiangtou Holdings had CNY75.1 billion (USD10.3 billion) in assets including a majority stake in listed energy company Hunan Development Group. It is also involved in manufacturing and finance.

Since 2020, a number of local governments, such as eastern Shandong province, southwestern Guizhou province, Guangxi Zhuang Autonomous Region and the Xinjiang Uyghur Autonomous Region, have established provincial-level energy groups to accelerate the national strategy of transitioning from coal power to clean energy.

Editor: Kim Taylor