Chinese residential customers hit by unplanned outages

122

Some residential consumers in northeast China are witnessing unplanned power outages following the power cuts targeting industrial customers in the past weeks.

The power outages are a result of an increase in the prices of coal and energy demand. According to Eastern Fortune, coal prices for power production have increased by 65% between July and September in China.

As a result, coal plants’ costs increased by 140 CNY ($21.68) / MWh compared to four months ago. Residential consumers have reported a lack of heating, and lifts and traffic lights not working as a result of the power outages.

Coal prices increase by 65% in the past four months in China. Source: Eastern Fortune

Power restrictions have been announced for industrial customers in 10 Chinese provinces in recent weeks, according to the BBC. Dongguan city in Guangdong Province mandated industrial consumers to completely stop power consumption between 22 September and 26, according to Azure International.

The BBC reported that the power outages are likely to last until spring next year, and become “the new normal” with more than 100 million residential consumers predicted to have been affected so far. However, the Chinese government is expected to ramp up its production of coal to reduce prices and source coal from Inner Mongolia to address the crisis.

The development comes days after Xi Jinping, the Chinese president, announced that the country will cease funding coal power production projects overseas in a bid to help mitigate climate change. {China pledges to stop funding overseas coal projects}.

However, media outlets, and climate change and energy analysts questioned why no commitments were made to reduce reliance on coal locally. With the current development, it is clear China still heavily relies on coal and needs to explore other avenues such as gas and renewables in its energy transition journey.

Have you read?
Severe drought strains South America’s power sector
EU natural gas prices to soar to record levels during winter

If China continues with its heavy reliance on coal, will the country be able to meet its 2060 carbon neutral target? Where will the world stand in its fight against climate change considering China consumes 50% of the world’s coal?

However, China is not the only country or region being affected by blackouts due to increases in energy commodity prices. Europe and Latin America are facing similar challenges due to increases in natural gas prices and drought, respectively.

China is not the only country turning back to coal to secure energy supply at a time when calls to expand reliance on renewables is increasing. Europe has also turned to coal in the past weeks to address the soaring energy prices, according to the International Energy Agency.