The recent electricity supply shortage in China

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According to several Chinese news outlets, announcements have been made in different areas such as Zhejiang province, Hunan Province, Jiangxi Province, and Inner Mongolia in China, mandating electricity consumption upper limit due to “recent stress from power sectors and electricity shortage”. Specifically, manufacturing processes have been forced to pause; electric heating is also not allowed in government buildings unless the temperature is below 3°C (37.4°F). Those “regulations” are effective immediately and will stay effective till the end of this year.

Winter is the peak time for HVAC usage. With the electricity shortage in such a bleak winter, it’s really difficult for people in those affected areas to get through their daily lives.

Misfortunes never come singly. Recently, Russian energy holding company InterRAO announced all of a sudden that it may “greatly reduce or totally cut off electricity supply to China”. Electricity supply by Russia has always been an important energy source for the northern part of China, and this sudden announcement happens to occur in a cold December. This is another example showing that contrary to the so-called “Sino-Russian friendship” that CCP always boasts about, Russia won’t stand with the Chinese.

To make matters worse, on top of all of these, the CCP government is sanctioning Australia by means of cutting Australian coal imports at the exact same time. CCP would like to retaliate against Australia by sanctioning because the latter took a tough stance on the CCP. For quite a long time, high-quality coal from Australia has been imported to China. But the import ramped down for the past several months and completely dropped to 0 by November 6th, 2020. As a result, the CCP government had no choice but to purchase lower quality coals from other countries at a higher price. It will undoubtedly cause more pollution in the environment. Now, even with these low-quality coals, there is still a significant electricity supply shortage in China. This is another vivid example showing that CCP will never consider the interest of the Chinese people because they only consider the party’s interests.

Key takeaways: Chinese Communist government is so ambitious that they would like to take over the whole world. It utilizes China’s huge market as leverage to force foreign governments to succumb to CCP’s evil desire. But Australia did not bend their knees and is working hard to prevent further infiltration from CCP. As a result, CCP disregarded the international free trade rules and abruptly stopped importing seven types of goods from Australia, including coal, which contributed greatly to the electricity shortage emergency and is having a terrible impact on numerous people’s daily lives in China.  This shows that CCP is a reckless government that never put people’s welfare first and also never follow international conventions and treaties.

Author: Evalu
Proofread by: Sister Karamazov

Gnews

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China’s power supply is struggling as winter temperatures plunge. Is the ban on Australian coal to blame?

In China, the prospect of resource scarcity is largely thought to be a thing of the past.

But this month, power outages have returned to some parts of the country, conjuring memories of China’s old command economy, where resource rationing was a part of daily life.

Chinese social media has seen tens of thousands of posts complaining about the new electricity restrictions in the country’s central and eastern provinces of Hunan and Zhejiang, which have been viewed more than 150 million times on the platform Weibo.

News of the restrictions comes amid a burgeoning trade spat between Australia and China, in which Australian coal appears to have effectively been barred from Chinese ports.

By November, more than 60 vessels carrying Australian thermal coal were held up in Chinese waters because they weren’t able to offload their cargo, according to Bloomberg shipping analysis data.

So do China’s recent energy woes have anything to do with its sanctions on Australia, or is it just an awkward coincidence?

What’s happened?

Residents of Hunan and Zhejiang have been issued notices stipulating the “orderly use of electricity”, along with other power restrictions that haven’t been seen for a long time, according to local media reports.

The restrictions have come during a particularly cold Chinese winter, where millions of people have switched on energy-intensive heating to cope with sub-zero temperatures.

Temperatures in Zhejiang plummet around this time of year, with daily average lows of 3 degrees Celsius in December — in January, the mercury usually doesn’t rise above 8 degrees.

According to China’s state-owned broadcaster CCTV, lights and lifts in some office buildings were shut off in a several cities across Hunan and Zhejiang.

The power outages forced some office workers in Hunan’s city of Changsha to climb 20 to 30 flights of stairs, according to a report in the local news publication iFeng.

Social media users in the city of Yiwu in Zhejiang made similar complaints.

“[Climbing stairs] almost killed me this morning.”

Changsha residents have also been advised against using energy-intensive appliances such as electric stoves and ovens, and not to set air conditioners above 20 degrees.

The ABC has also seen an online notice to a middle school in Zhejiang, banning staff and students from turning on heating if temperatures exceeded 3 degrees.

Do we know what’s causing the power pinch?

In Hunan, authorities said the province of more than 67 million people had reached the electricity grid’s maximum load, with a predicted gap of 3 million to 4 million kilowatts of energy during winter’s peak period, according to local media.

“This year’s situation is quite special. One is that winter comes earlier and the weather is relatively cold,” a spokesperson for Changsha’s Development and Reform Commission told China’s Cover News this week.

This was again stated by a spokesperson for the Changsha Power Supply Company, who said Hunan’s power pinch was partly due to the cold, and partly due to a drop in energy production capacity.

Wu Donglin said the latter comprised of “the reduction of coal burning, the decline of reservoir water levels, and the inability of wind power to generate electricity” because of freezing temperatures.

Mr Wu’s comments came after an editorial published in the state-owned Global Times tabloid claimed Beijing was preparing to let power producers import coal from several countries without restrictions, “except for Australia”.

China’s coal imports on the whole have been on a downward trajectory according to official Government statistics — in other words, it’s not just Australian coal that has been having trouble entering China’s market.

“In November, 11.67 million tonnes of coal were imported, a decrease of 2.06 million tonnes from the previous month, and a year-on-year decrease of 43.8 per cent,” a statement from the National Bureau of Statistics read on Tuesday.

“From January to November, 260 million tonnes of coal were imported, a year-on-year decrease of 10.8 per cent.”

While coal makes up the lion’s share of China’s energy mix, it has been on a minor downward trajectory in recent years as Beijing begins a transition to clean energy.

So is the ban on Australian coal to blame?

Shane Oliver, AMP Capital’s chief economist, told the ABC it was quite possible that the power cuts had a link to the coal ban, but that it was impossible to know for sure.

“The disruption to the supply of coal into China as a result of the bans on Australia may also be playing a role in that and causing rationing,” he said.

“It is quite normal to have cold winters at this time of the year in China, so one would assume that’s been allowed for.”

However he said it was premature to assume China’s trade tactics against Australia had backfired.

“Trade wars are not desirable, they do result in both sides losing: obviously one side loses because they don’t get the supply and quality of supply that they’re used to, the other side loses because they lose an export market.”

Jun Mao, a thermal coal analyst at Jiangsu Jinying Capital Management, told the ABC the power shortages were a sign of supply and demand issues in China.

“China’s thermal coal stocks are insufficient and the price is relatively high. But it hasn’t been completely out of control,” he said.

“The Chinese Government is already coordinating, and I think the problem will be resolved soon.”

Mr Mao said he believed the power shortages had “some connection” to China’s ban on Australian thermal coal, but that it was “not the main reason”.

“It is also related to some domestic factors, which have impacted on the shortage of thermal coal,” he said.

Hu Xijin, editor of the Global Times, wrote on social media that it was “nonsense” to link China’s power shortage to the ban on Australian coal.

He said the ban had a “subtle impact” on China’s electricity supply, because “the coal imported from Australia is mainly coking coal and China has rich resources of thermal coal”.

How much energy does China use?

To understand China’s energy consumption, you have to understand that it’s a paradox.

While the country is the largest consumer and investor in renewable energy, it is also by far the largest consumer of coal on the planet.

This makes it the world’s largest emitter of greenhouse gases, while also being a renewables superpower committed to being carbon neutral by 2060.

But coal is still largely responsible for keeping the lights on across China, where energy consumption has skyrocketed in recent years.

Data from the International Energy Agency showed that in 2018, China consumed more than 6,800 terawatt hours of energy, which eclipsed the total energy consumption for all of North America in that year.

On Wednesday, a spokesperson for China’s National Development and Reform Commission said China’s year-on-year electricity consumption increased by 9.4 per cent last month.

How much Australian coal has China sanctioned?

China isn’t dependent on Australian coal for its energy — that being said, Australian coal has been a part of China’s energy mix for several decades now.

Australian coal exports comprise two varieties: thermal coal, which is burnt for electricity, and metallurgical coal, which is used for making steel and iron ore.

Last year, 18 per cent of all Australian thermal coal exports were sent to China, with a value of $4 billion, while total coal exports were worth $13.7 billion.

The slowdown in Australian coal exports to China began to emerge in September, with ships carrying Australian coal barred from offloading their cargo at Chinese ports.

This month, no ships carrying thermal coal from Newcastle — Australia’s busiest coal port — have left for China, and none are scheduled to leave before Christmas.

As this trade appears to have been effectively cut off by China, it joins an ever-growing list of Chinese sanctions against Australian imports amid a worsening geopolitical stoush.

Beijing laid some of its issues with Canberra officially in November, delivering a list of 14 “grievances” that noted Australia’s “anti-China” government-funded research at the Australian Strategic Policy Institute (ASPI), “interference” in China’s internal affairs regarding Hong Kong, Taiwan and Xinjiang, and ban of Huawei from the construction of Australia’s 5G network.

Alongside trade, Australian diplomats and ministers have had their contacts with Chinese officials frozen, and Australian calls for a dialogue with China have been left unanswered.

By Jason Fang, Bang Xiao, and Alan Weedon
ABC

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