State Grid’s Plan to Invest RMB 4 Trillion During China’s 15th Five-Year Plan Period

In December 2025, China’s National Development and Reform Commission and National Energy Administration jointly issued the Guidelines on Promoting the High-Quality Development of Power Grids. The document emphasizes increasing power grid investment, advancing construction under the principle of “appropriate advancement without over-advancement,” accelerating the renovation and upgrading of existing grid assets, and strengthening the foundation of China’s new power system.

The Guidelines also define quantitative targets for 2030. By that point, the scale of the West–East Power Transmission project is expected to exceed 420 gigawatts, while inter-provincial power mutual-aid capacity will rise by around 40 gigawatts. New energy power generation is targeted to account for approximately 30 percent of total electricity output. In addition, the grid’s accommodation capacity for distributed new energy is expected to reach 900 gigawatts, while supporting more than 40 million charging infrastructure units, reinforcing the public power grid’s system-wide support role.

Against this policy backdrop, grid investment execution has continued to accelerate. According to Xinhua News Agency, State Grid Corporation of China disclosed on January 15, 2026 that its planned fixed-asset investment during the 15th Five-Year Plan period (2026–2030) will reach RMB 4 trillion. This represents a 40 percent increase compared with the 14th Five-Year Plan period and marks a historical high.

Key Investment Focus Areas

UHV and Main Grid Construction: Core Transmission Corridors

State Grid plans to accelerate construction of Ultra-High Voltage (UHV) DC transmission corridors to support power evacuation from large-scale new energy bases in desert and Gobi regions, as well as hydropower bases in Southwest China. Inter-regional and inter-provincial transmission capacity is expected to increase by more than 30 percent compared with the end of the 14th Five-Year Plan period, further consolidating the West–East Power Transmission and North–South Power Supply framework.

At the same time, the company will strengthen inter-regional back-to-back mutual-aid projects to enhance flexible regulation and power supply security of the main grid, directly addressing the long-standing issue of new energy power “being unable to be transmitted out.”

New Energy Grid Integration and System Regulation Capacity: Consumption Support

State Grid aims to support an average annual increase of around 200 gigawatts of installed wind and solar capacity across its operating regions, pushing the share of non-fossil energy consumption toward 25 percent. The plan includes optimizing the layout of pumped storage power stations, accelerating large-scale deployment of new energy storage, and improving system-level peak regulation capabilities.

The construction of new energy collection stations, transmission lines, and localized balancing facilities is intended to resolve the persistent challenge of “being able to generate electricity but unable to utilize it effectively.”

Distribution Network Upgrading and Smart Microgrids: Terminal Optimization

Distribution networks in urban, rural, and remote areas will be upgraded through renovation of aging lines and equipment, with a focus on improving reliability and intelligence. State Grid will also explore terminal supply-guaranteed and off-grid microgrids to accommodate growth in distributed energy resources and localized loads.

Digital and intelligent infrastructure will be further consolidated through the implementation of the “Artificial Intelligence +” initiative, enhancing the flexible control and self-healing capabilities of distribution networks.

Terminal Energy Electrification and Charging Infrastructure: Consumer-Side Transformation

To support electrification on the demand side, State Grid plans to meet the grid connection needs of 35 million charging facilities, strengthen urban–rural charging networks, and support the broader adoption of new energy vehicles. The investment will also serve zero-carbon factories and industrial parks, promoting deeper electrification across industry, buildings, and transportation, and increasing electricity’s share in terminal energy consumption to 35 percent.

Key Technology R&D and Industrial Chain Independence: Innovation-Driven Development

More than RMB 240 billion will be allocated to research and development to address key technologies underpinning the new power system. Priority areas include power electronics, energy storage, and dispatching control systems, with an emphasis on achieving industrial chain independence and controllability.

State Grid will also advance the integration of Artificial Intelligence and power grids, developing digital twin grid models and intelligent dispatching platforms to improve operational efficiency and system safety.

Implications for China’s Power Automation Market

State Grid’s RMB 4 trillion fixed-asset investment during the 15th Five-Year Plan period is expected to significantly reshape China’s power automation market. Distribution network automation, UHV control and protection, AI-enabled dispatching systems, and terminal energy automation are likely to emerge as core growth segments, with market scale expanding substantially compared with the 14th Five-Year Plan period.

Beyond capital inflows into grid automation and digitalization, the investment is expected to accelerate a structural shift from traditional secondary equipment toward integrated “hardware + software + algorithms + services” solutions, increasing the share of software and service-based offerings. It will also generate demand for advanced technologies such as UHV controllable commutation converters, distribution network edge computing terminals, and power grid AI foundation models, while accelerating upgrades in core components including power electronics and IGBTs.