Power Outages Hit Many Cities In China As Ban On Coal Import From Australia Causes Shortage

More than dozen cities China have been experiencing power cuts in recent weeks as a result of the decision by Beijing to ban imports of Australian coal, The Financial Times reported.

A Chinese state-owned newspaper Global times last week that the Chinese National Development and Reform Commission had authorised power plants to import coal with no limitations, except from Australia.

Many cities in the country including economic engines like Shenzhen, Guangzhou,Dongguan, Zhongshan and Zhuhai have faced power outages as restrictions have been imposed due to shortage of coal.

In Hunan Province, the local government has directed its power agencies to cut their electricity use, and half of the province's street lights will be turned off at night to tackle the "tightening" power supply. In Changsha, the provincial capital, high-rise buildings can't keep their elevators operating. Workers have sometimes been forced to climb 20 floors to their offices.

The Financial Times report quoted an executive at China Huadian Power (one of its largest energy companies, as saying that "many local power plants depend on Australian coal due to its higher efficiency, and now they are having trouble finding an alternative."

Chinese authorities have also blamed power restrictions on the particularly cold Chinese winter this year. Power demand as surged as millions of people have switched on energy-intensive heating to cope with sub-zero temperatures.

According to a report in Bloomberg, more than 60 vessels carrying Australian thermal coal were held up in Chinese waters because they weren't able to offload their cargo. Responding to the energy embargo, China’s Foreign Ministry spokesperson Zhao Lijian said that there had been cases where the imported coal didn’t meet the country’s environmental protection standards.

China relies on high-quality Australian coal to power its latest generation of coal power plants.

In 2019, 18 per cent of all Australian thermal coal exports were sent to China, with a value of $4 billion, while total coal exports were worth $13.7 billion.

Amid escalating trade tensions with Australia, China’s coal imports from down under dropped by 47 per cent in October 2020 compared with the corresponding period last year.

According to IEA (International Energy Agency) Clean Coal Centre, Australia supplied more than 40 per cent of China’s coking coal imports and 57 per cent of the nation’s thermal coal last year.

The relations between Australia and China has rapidly deteriorated this year after Scott Morrison-led government called for an independent inquiry into how coronavirus began. China has retaliated by imposed tariffs on Australian products.