China is likely to fail its 2006 GDP energy reduction target, said Xie Fuzhan, commissioner of the National Bureau of Statistics (NBS) on Thursday.

China's 11th Five-year Plan on national economic and social development set a 20 percent reduction target in per unit GDP energy consumption for the 2006-2010 period, equivalent to four percent per year.

Chinese economic planners are calculating the result for 2006.

"It's very hard to reach the goal," Xie said. "It is a massive challenge to save energy and cut consumption."

China's energy consumption per unit of GDP edged up 0.8 percent in the first half of last year, according to the NBS. Energy consumption per unit of added value increased in the coal mining, oil and petrochemicals, non-ferrous metal and other industries, and dropped in steel, building materials and textile industries.

Insiders have attributed high energy consumption to irrational industrial structure, a too-high proportion of heavy industry, lack of investment in energy saving and relevant technologies as well as inappropriate finance, taxation and credit policies.

However, Xie said, energy consumption began to drop in the third quarter of last year, the first time in the last three years, a "positive signal" which indicates that China's efforts in this regard have begun to pay off.

Xie said he was confident that China would make more visible achievements in energy saving in the coming years as it continued to increase investments in the energy sector and to upgrade technology.

Xie said central and local governments of China are aware of the importance of reducing energy consumption and have adopted a series of measures. Price and taxation changes will be made and industries restructured -- high energy-consuming and polluting production facilities will be shut down.

China closed coal mines with a combined production capacity of 110 million tons last year, because these mines failed to meet safety, environmental protection and energy efficiency standards, Xie said.

At the same time, a group of energy-saving, environmentally-friendly thermal power plants were put into operation, the official said.

The government will make energy reduction an economic priority this year, continue to transform the mode of economic growth and improve economic performance and efficiency, according to the National Development and Reform Commission (NDRC).

The government is determined to achieve energy consumption cuts in 2007, an official with the NDRC said on Wednesday.

(Xinhua News Agency January 25, 2007)