The Chinese government has signed a deal with Russia for the supply of two reactors for a nuclear power plant at Lianyungang, northwest of Shanghai. Work on the two 1000 MW units is due to begin in 1999.

The $2 to $3 billion deal will involve construction of two VVER-1000 light water reactors. Russia will provide financing for the project worth $1.8 billion, the Chinese government has said. The two units are due to become operational in 2004 and 2005. There is an option to extend the power plant, in Jiangsu Province, with two further reactors.

In a separate move, the US government has formally certified that China has met its nuclear nonproliferation requirements. Provided congress does not block certification documents signed by the US president, US companies will be able to compete for the nuclear power business in China. This business is estimated to be worth $60 billion until 2002.

Meanwhile the Chinese government has also announced plans to shut down hundreds of small thermal power plants in an effort to reduce air pollution. There are a large number of small, inefficient fossil-fuelled power plants in the country. Hydropower will be promoted instead.

Currently, hydropower acc- ounts for around 24 per cent of the installed capacity in China. This is expected to rise to 30 per cent by 2010, according to Chinese estimates.