China's electricity demand is projected to maintain steady growth in 2025, with total consumption expected to increase within a range of 4 percent to 6.5 percent, according to a report released by the State Grid Energy Research Institute.

The report, titled "China Power Supply and Demand Analysis Report 2025", forecasts total nationwide electricity consumption to reach 10.3 trillion kilowatt-hours in 2025, a 5 percent increase from the previous year.

Power generation capacity is set for rapid expansion this year, projected to reach around 3.99 billion kilowatts by the end of 2025, a 19.2 percent increase from the previous year and maintaining a fast growth momentum, said Ji Guoqiang, an analyst at the institute.

This year is also expected to see a record amount of newly added power generation capacity, increasing 53.2 percent compared to the new capacity added in the previous year, he said.

"This surge in new installations will push the share of renewable energy in total installed capacity past 45 percent by the end of 2025, with solar power specifically projected to exceed 30 percent," said Ji.

The figure demonstrates the country's stronger push toward decarbonization and reducing reliance on fossil fuels, a critical step toward meeting China's climate targets and enhancing energy security by diversifying its power sources, he said.

The forecast for electricity demand is set against a backdrop of projected national economic growth, with China's GDP expected to expand by around 5 percent in 2025, the report said.

Integrating such a large proportion of variable renewable energy into the grid presents substantial technical and operational challenges, as the intermittency of solar and wind power requires significant investment in grid upgrades, energy storage solutions and flexible generation sources to ensure a stable supply, especially during peak demand periods or when renewable output is low.

Analysts said this rapid buildout highlights the ongoing need for sophisticated grid management and market reforms to accommodate the changing energy landscape.

China's robust economic growth will continue to fuel strong demand for energy and electricity in the country, requiring massive renewable energy buildout and significant grid upgrades for a stable and clean power supply, they say.

According to figures released by the China Electricity Council, China has improved its grid infrastructure and capacity in recent years, with inter-provincial transmission capacity exceeding 300 million kW.

Accelerating the construction of a unified national power market is expected to further optimize power resource allocation nationwide, said Yang Kun, executive vice-chairman of the council.

However, the report cautions that the overall power supply-demand balance is expected to be tight nationwide, with potential for strained supply during peak periods in certain regions.

The services sector, or tertiary industry, is expected to be one of the main drivers of overall electricity consumption growth this year, with its power usage forecast to climb 9.5 percent.

This growth is attributed to various consumption-boosting policies stimulating potential, a steady recovery in traditional consumption, and the emergence of new consumption growth points and expanding scenarios, it said.

Growth in new infrastructure is also set to boost demand. The number of 5G base stations nationwide is expected to surpass 4.7 million by the end of 2025, potentially adding over 30 billion kWh to electricity consumption, it said.

The rapid adoption of electric vehicles will be another significant factor. The report forecasts a net increase of around 8 million pure electric vehicles in 2025, bringing the total fleet size to approximately 30 million by year-end.

This surge is projected to push annual electricity consumption for charging and battery swapping services to 102 billion kWh, an increase of about 19 billion kWh from the previous year, it said.