The draft of China's first energy law is currently being discussed by all related departments and enterprises. As the discussions get deeper, there are increasing voices calling for reestablishing the Ministry of Energy.

The law, aimed to standardize energy supervision, covers all aspects of China's energy strategies and programs including energy exploration, efficiency, security and emergency response as well as international cooperation.

China set up the Ministry of Energy in 1988 but it was dismantled five years later because its administrative functions overlapped with other departments. Faced with increasing energy shortages, the government set up an energy bureau under the National Development and Reform Commission (NDRC) in March 2003. The bureau was crippled, however, because much of the administrative power in the energy sector was scattered between different government organs and major oil, power and coal companies including the State Electricity Regulatory Commission, the State Administration of Coalmine Safety, the Ministry of Water Resources, the Ministry of Land and Resources, China National Petroleum Corp., Sinopec Group and State Grid Corp. of China.

Energy issues have become one of the major bottlenecks for China's economic development following its rapid growth in the last decade. It is imperative the government set up a uniform body for energy macro-control and supervision. Economists and energy experts have called for reestablishing the Ministry of Energy, especially after China suffered a widespread energy crunch in 2004. Many delegates have submitted proposals to establish a ministry of energy to the National People's Congress (NPC), China's top legislature, in March of the past two years.

Usually, creating a ministry as important as the energy ministry is only possible when the tenure of the current government ends and the newly elected one carries out institutional reform. As the office term of this government will expire in early 2008, the coming March will reveal a better chance for the energy ministry, otherwise, it might have to wait five years for another opportunity.

Overlapping decision-making

Before the Ministry of Energy was set up in 1988, four former ministry-level organs were responsible for energy administration, namely, the Ministry of Petroleum Industry, the Ministry of Coal Industry, the Ministry of Nuclear Industry and the Ministry of Electricity.

During the institutional reform in 1988, the Ministry of Energy was set up to replace the Ministry of Electricity and take over administration functions of the three other energy-related ministries, which were turned into three enterprises. However, the decision failed to win support from the petroleum and coal ministries and 20-odd former officials of the coal ministry appealed to the State Council to resume the ministry.

During the 1993 institutional reform, their wishes came true when the Ministry of Energy disappeared and the Ministry of Coal Industry and the Ministry of Electricity came back. China's energy administration was again scattered and administration efficiency crippled.

In 1997, the Ministry of Electricity was turned into the State Grid Corp. of China and the Ministry of Coal Industry was abolished.