Serious power shortages across China

Since mid-September, more than 20 of China’s 34 provinces have experienced power rationing for industrial and commercial users, as well as some households.

The northeast provinces have also had unannounced blanket outages for entire areas, causing grievances and even accidents.

A number of provinces also experienced power shortages at the end of last year. But this time it’s more alarming, as it’s more widespread and is happening in autumn, when the grid isn’t yet handling the biggest load of the year.

The causes identified are multiple and still contested. The most agreed-upon culprit is the surging coal price and low and rigid power tariff: in many cases, it costs coal plants more to generate power than they make from selling it. This has prompted calls for marketisation of the tariff system

But in some cases, coal seems to be outright unavailable for power plants, due to cuts in coal mining capacities, mines being closed for safety inspections, transport congestion, and decline in imports.

The “dual controls” system – of energy intensity targets and caps on total energy consumption – is widely believed to have played a role in some of the affected provinces. An outlet of the People’s Daily put the shortages down to local governments’ last-minute scramble to hit the targets. However, some observers have dismissed this emphasis on the role of environmental regulations as “industrial spin”.

For the shortages in the northeast in particular, blame is also being placed on the high percentage of wind power in the energy mix; wind saw a sudden decline in output last week. But a representative of the renewables industry said it is misleading to draw this conclusion in the absence of accurate data. A lack of transparency in power dispatch data make any causal attribution mere speculation, another expert suggested.

Read China Dialogue’s piece on whether the “dual controls” system can still drive China’s low-carbon transition.