China’s power supply under test in 2021 summer

Posted on 22 July 2021

China’s power supply has been under serious test since the start of 2021, firstly in winter because of the extremely cold weather in some regions together with the surging power consumption in many industrial sectors as a result of heavy government spending and fixed asset investments to cushion the domestic economy from the blow of the COVID-19.


Earlier this year, China had reported power supply shortage in Yunnan and Guangdong, though the situation alleviated by mid-June, as reported, and now another challenging period - summer - has arrived when power use by households tend to spike in the hot days, especially As of early July, China’s power consumption had already matched the peaked for last summer, according to China’s National Development and Reform Commission (NDRC).

It has been over a decade when summer power supply shortage had occurred in China, and I still remember around 2008 summer when office buildings in Beijing were set the minimum temperature for their central air-conditioning system at above 20 degrees Celsius as part of the efforts to ration power supply.

“If you have any doubts about the accuracy about a country’s GDP growth, check out its power consumption growth, and usually that is a rather clear and accurate indicator of how its economy is performing,” a market source shared.

“With the heavy spend from the Chinese authorities, just as many other governments since last year to rescue their economies from the COVID-19, I am not surprised at all that China is again facing power supply shortage in some regions,” he added.

For 2021 summer, NDRC has worked out detailed guidelines on how to deal with possible powers supply shortage, Jin Xiandong, the commission’s spokesperson, shared at a press conference on July 19, such as requesting all the local authorities and power houses to closely monitor the situation and especially during the peak hours for any supply shortage, and to execute emergency measures if necessary.

All the local authorities are also requested to guarantee the commissioning of new power houses as per schedule, and to maximize the power generation from clean resources such as hydro, nuclear, wind and solar and at the same time to stabilize the supply from the coal-fired power houses by rescheduling maintenance when necessary.

Power transmission across regions via national grid should be optimized too, and power supply should be prioritized according to the orders of citizens, agriculture, key public service sectors and social welfare systems to assure the power consumption among the households and key sectors.

NDRC also urged the country’s utilities firms to build up their stocks of thermal coal for no less than seven days of consumption by July 21 so as to ensure that no power outages are caused by coal supply shortages, as reported.

In the first half of 2021, China’s power generation grew 13.7% on year, while the country’s power consumption soared 16.2% on year with tertiary industry growing the fastest by 25.8% on year, while agriculture up 20.6% on year, according to Jin’s sharing at the press conference.

Among 31 provinces, autonomous regions, and municipalities in the Chinese mainland, 15 saw their power consumption up over 17% on year with seven including Tibet, Hubei, Guangdong, Zhejiang, Yunnan, Jiangsu, and Jiangxi posting an over 20% on-year jump in their power consumption.

Source : Mysteel Global