Power rages hit many places around China

14:52, April 28, 2011      

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Since March, electricity shortages have appeared in many places in China even though the peak period of power consumption has not arrived yet.

Different levels of insufficient power supply have appeared in Zhejiang, Hunan, Jiangxi, Chongqing, Guizhou and other places, and local areas are actively taking measures such as “power limitation” and “power restriction” to cope with the shortages.

Why are there electricity shortages during the low season of electricity consumption? Lin Weibin, deputy director of the Research Center of Energy and Strategic Resources under Beijing Normal University, said to reporters that the shortage of coal supply is the cause of an electricity shortage, and the essential method for solving this problem is to raise the electricity price.

Inadequate coal supply is the main cause of power rages

On April 15, the National Development and Reform Commission (NDRC) issued an early warning that the power supply will not be adequate in most places in 2011, and that the power supply will especially be not sufficient in eastern China, northern China and the southern regions of China. However, the electricity shortage has come ahead of schedule.

According to some reports, by April 25, the monthly electricity saved by the Central China Grid Company had reached over 20 million kWh and Zhejiang Province had experienced its severest electricity shortage in the past seven years.

Lin told the reporters that people should analyze both the supply and demand aspects in order to find the causes of the electricity shortage. Regarding the demand, 2011 is the first year of the “12th Five-Year Plan” and a lot of projects have started. Meanwhile, some projects delayed at the end of the “11th Five-Year Plan” because of carbon emissions reduction have been restarted as well. This has led to the increase in power consumption. In addition, the sharp increase of the power consumed by residents and the tertiary industry has also worsened the situation. Regarding the supply, the fundamental reason is the shortage of coal supply. Other reasons include the turbulent development of hydroelectricity in 2011.

“The flood season of Hunan Province and Hubei Province also arrived late and the water current is not strong enough. These unpromising hydroelectric development situations have given more pressure to China's power supply.

Wang Ting from the Web site ww.coal.chem99.com shares the same viewpoint with Lin. Taking Guizhou Province as an example; the province has accelerated the reorganization of its coal enterprises since April, and shut down some small coalmines. That has led to the decrease of coal production and the insufficient coal supply of thermal power plants, and therefore leading to the insufficient power supply.

Han Xiaoping, chief information officer of the www.China5e.com, believes the biggest reason for the electricity shortage is the rising international oil prices. Han said that the rising international oil prices have caused the increase in transportation costs, resulting in the perpendicular rise of thermal coal prices. In addition, the rising thermal coal prices have also forced some electricity generation enterprises to reduce electricity production or even stop generating electricity. This has exacerbated the tension in the power supply.

Power shortage will not last for the long-run

Some people are worried that the electricity shortage will spread throughout the country along with the arrival of the summer power consumption peak period and become a normal state. However, Lin said that the tense situation is inevitable, but the shortage is not as severe as the market predicted. The government will timely introduce policies to ease the current situation.

Wang said that as the electricity consumption peak period is approaching, thermal coal companies will make efforts to increase the coal reserve, and the tension in thermal coal supply will be greatly eased along with the strong momentum in the development of hydroelectricity in the future.

According to sources, although the output of raw coal in Shaanxi Province, one of China's main coal producing areas, was affected by the integration of coal resources and corporate mergers and acquisitions in 2011, the output of other main coal producing areas such as Inner Mongolia Autonomous Region and Shanxi Province continues to maintain a rapid growth momentum. Therefore, the total coal production is guaranteed in 2011.

Experts: Raise electricity prices will resolve shortage

Liu Tienan, director of the National Energy Administration, has required related departments to make every effort to guarantee the electricity supply during the power consumption peak period. Local governments will limit or cut the power supply for high-energy consumption enterprises to ease the shortage, and various places have also adopted various measures to solve the electricity shortage situation.

Wang said that in order to improve the efficiency of the thermal coal transportation, Hunan Province issued provincial permits to special thermal coal transport vehicles to dispense their tolls. Guizhou Province also increased the trans-provincial regulation fund of thermal coal from 100 yuan per ton to 200 yuan per ton to restrain the external flow of coal.

However, Lin believes the fundamental way of solving the shortage is to adjust the energy pricing system, and increasing electricity prices is the top priority. Han also said the way to solve the problem is to allow the market pricing to break the monopolization of power grid companies and implement effectively resource allocation.

By People's Daily Online

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