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China’s power crisis
EconomyChina Economy

5 things you need to know about China’s power crisis

  • China has been dealing with power rationing and blackouts since September due to Beijing’s determination to cut emissions and surging prices
  • The power crunch has already had an impact on the economy and has raised concerns ahead of the winter heating season

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China is the world’s largest producer and consumer of coal, used for heating, cooking, electricity generation and steel making. Photo: Reuters
Andrew Mullen

1. China’s state planner is weighing steps to tame prices

China’s state planner has met coal producers and an industry body to discuss measures such as setting price levels and ways to better identify companies engaged in “profiteering”, it said on Thursday, aiming to tame prices during a severe power crunch.
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Coal futures have nearly halved from a record high on October 19 after the talks on price intervention at Wednesday’s meeting held by the powerful National Development and Reform Commission.

The meeting “focused on the reasonable price range and profit margin that should be maintained to promote the coordinated and sustainable development of the coal industry and downstream power industries,” the planning body said.

It did not disclose what level prices would be set at, but three major coal producers said on Wednesday they would fix ceilings for prices of thermal coal at 1,200 yuan (US$188) a tonne for the winter heating season.

2. It’s increasing China’s demand for natural gas

China’s demand for natural gas for this winter is expected to rise by 10 per cent from a year earlier to 6.3 billion cubic feet, an official from the country’s top oil and gas producer, PetroChina, said on Thursday.

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