More Than Half Of China’s Provinces Are Now ‘Rationing’ Electricity, Governors Demand More Coal Imports To Resolve Crisis
At least 20 Chinese provinces and regions making up more than 66% of the country’s GDP have announced some form of power cuts. Guangdong province, the southern industrial hub, is cutting ~10% of its peak power demand…
And as the severe power crunch hits major industrial hubs in China’s northeastern heartland, top political leaders face mounting pressure from businesses and citizens to solve the crisis through increasing coal imports to keep the lights on and factories humming.
Reuters spoke with Han Jun, governor of the northeastern province of Jilin, who said new coal suppliers are needed from Russia, Mongolia, and Indonesia. He added the province would also need to acquire coal mining contracts in the neighboring region of Inner Mongolia to ensure adequate supply.
Jilin is one of the ten provinces that have been hit hard by the power crunch. The government has rationed power to energy-intensive heavy industries like steel, cement, and aluminum plants to solve the problem, but that has yet to work. Power plants are also facing a surge in thermal coal prices and are unwilling to pass on to consumers.
Han said companies must satisfy their “social responsibilities” and “overcome the difficulties” caused by elevated coal prices.
On Sunday, top suppliers of Apple and Tesla reported they had suspended operations as the government limited power to their factories. The power crunch is becoming an international issue that may cause additional headaches for global supply chains, especially when US importers are ordering goods ahead of the holiday season.
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