China’s Power Plants Running Out of Coal
Lack of fuel has forced 32 power plants to shut down, the State Electricity Regulatory Commission said in a report. It said two of those were in Sichuan province, where last week’s magnitude 7.9 quake damaged the power supply grid.
The agency’s warning came three months after freak winter snowstorms caught power plants without adequate coal supplies in February, causing blackouts and factory shutdowns.
Utility companies let coal stocks run low after Beijing froze power prices last year to cool inflation but let market-set coal prices continue to rise. With the cost of coal at record highs, power generators are trying to avoid losses by purchasing less.
China relies on coal for 70 percent of its power.
The SERC gave no indication how Beijing might respond to the latest shortages. An employee who answered the phone in its press office referred questions to the Cabinet’s National Development and Reform Commission. The NDRC did not immediately respond to requests for comment.
Power plants in the eastern province of Anhui have an average of just 2.8 days’ supply of coal, while those in Beijing have 6.9 days’ supply, the agency said. The recommended minimum is 15 days; a week’s supply is considered the “danger line.”
In Sichuan province, where the May 12 quake killed tens of thousands of people, power plants have an average of just seven days’ supply of coal and two facilities have none, according to the agency.
In February, the government responded to coal shortages by keeping hundreds of mines running through the Chinese New Year to replenish stockpiles. But Tuesday’s report suggested power plants let supplies run down after that.
Regulators have rejected appeals by utility companies to raise power prices.
China’s power demand is growing at double-digit annual rates, driven by a boom that saw the economy expand by 10.6 percent in the first quarter of this year.
