Datang sees need for more China power tariff hikes

HONG KONG Aug 27 (Reuters) - Datang Power (0991.HK) (601991.SS) estimated on Wednesday that China will have to hike power tariffs another 0.05 yuan per kilowatt-hour (KWh) in 2008 to offset its rise in coal costs, despite Beijing having raised electricity fees twice in two months.

President Cao Jingshan told reporters the firm enjoys a 600 million yuan ($88 million) rise in revenue for every 0.01 yuan/KWh increase in fees. He estimated Beijing raised tariffs about 0.03 yuan/KWh this year but more was needed. [ID:nSP242434]

A surge in global coal prices has led loss-making power plants to curb output and fomented a domestic supply squeeze as miners tried to capture higher export prices. The subsequent slowdown of growth in electricity generation is pressuring manufacturing and impeding economic growth. ($1=6.849 Yuan) (Reporting by Judy Hua; Editing by Ken Wills)