By Dave Brown - Exclusive to Uranium Investing News Most of mainland China's electricity is currently produced from fossil fuels with approximately 80 percent from coal, 2 percent from oil, and 1 percent from gas. Hydropower is also an important source in the energy mix for the country, attributable for 15 percent of electricity produced. Two large hydro projects are recent additions: Three Gorges of 18.2 GWe and Yellow River of 15.8 GWe. In November, analysts were suggesting that a shale gas market will emerge quickly in China as the players ramp up activities in the unconventional gas sector, which is likely to experience double-digit growth year-on-year. China is still seen to be at a preliminary stage of developing unconventional gases such as shale gas. Urbanization, industrialization and rapid growth in demand have given rise to power shortages; the reliance on fossil fuels has led to much air pollution. The economic loss due to pollution has been estimated by the World Bank to be almost 6 percent of the nation's gross domestic product (GDP). In 2009, power shortages were most acute in central provinces, particularly Hubei, and last December the Central China Grid Co. posted a peak load of 94.6 GW. Underlying Disadvantage Although coal is currently the main source of energy for China, most reserves are in the north or northwest of the country and this presents a significant logistic problem. Nearly half the country's rail capacity is used in transporting coal. China is well advanced in developing and deploying supercritical and ultra-supercritical coal plants, as well as moving quickly to design and deploy technologies for integrated coal gasification combined cycle (IGCC) plants. The government has forced the retirement of some smaller inefficient coal fired plants with over 60 GWe closed over the last 4 years. This has reduced annual coal consumption by more than 69 million tonnes and annual carbon dioxide emissions by 139 million tonnes; however, because of a continued reliance on old coal fired plants, electricity generation accounts for much of the country's air pollution. This context provides a compelling reason to increase nuclear share and enables tremendous opportunities for uranium mining companies and investors.