Caixin
Dec 21, 2020 06:41 PM
BUSINESS & TECH

Cold Snap, Recovering Economy Drive Record Power Demand

State Grid Corp. of China, the nation’s largest grid operator, said late Friday that some parts of the country were experiencing short-term tight supplies due to high demand created by cold winter weather and the rapid speed of China’s economic recovery.
State Grid Corp. of China, the nation’s largest grid operator, said late Friday that some parts of the country were experiencing short-term tight supplies due to high demand created by cold winter weather and the rapid speed of China’s economic recovery.

A cold snap and rapid economic recovery pushed demand for power to record levels in large swathes of Central China last week, leading to shortages that prompted many areas to limit consumption and resort to controlled blackouts.

The problem has been compounded by recently soaring coal prices, since plants powered by the fossil fuel supply about half of China’s electricity. Domestic coal supplies have been squeezed recently due to tighter inspections following a series of recent mining accidents; while imports have also plunged as most users have stopped buying from one of China’s leading suppliers, Australia, amid recent trade frictions.

Last week saw record electricity demand in a number of provincial-level regions, including Jiangxi, Hubei, Guangxi and Hebei. Cities experiencing similar major spikes included Chengdu, Chongqing, Xi’an and Beijing. Among those, Jiangxi, Guangxi, Chengdu and Xi’an all imposed usage restrictions to cope with the short supplies. Last week’s spike came after Hunan and Zhejiang provinces experienced similar jumps in demand that led them to also limit consumption.

State Grid Corp. of China, the nation’s largest grid operator, said late Friday that some parts of the country were experiencing short-term tight supplies due to high demand created by cold winter weather and the rapid speed of China’s economic recovery.

One of the hardest hit areas was the nation’s central area, where temperatures last week averaged less than 10 degrees Celsius on five consecutive days — roughly two to three degrees below average. The Central China power grid saw usage peak at 144.28 gigawatts, up 21% from last year and setting a record for winter. Individual province records were set in Hubei, Hunan and Jiangxi.

Jiangxi province implemented restrictions starting Dec. 15, encouraging big users to curtail consumption during peak hours and calling on the electricity providers to implement blackouts in an orderly way when necessary, while guaranteeing supplies would continue to ordinary citizens and important users.

Energy analysts pointed out that Central China had limited ability to bring in extra capacity during such times of high demand, and that supplies might continue to be tight for a while. They noted that the region lacks coal resources, and that coal prices have risen to uncomfortably high levels due to short supplies. The region also has limited resources in terms of cleaner energy sources such as solar and wind.

Outside the Central China region, South China’s Guangxi Zhuang autonomous region also experienced record usage that prompted providers to request users to limit their consumption during peak periods. The Guangxi government news site said cold weather had caused usage to peak last Monday evening at 26.81 gigawatts, up 2.6% from the previous record.

In Southwest China, Chengdu and Chongqing also struggled with record high demand as temperatures fell as low as 4 degrees Celsius in Chengdu. The Sichuan provincial capital recorded its own peak usage of 14.38 gigawatts just before noon last Thursday. Power supplies in the city are expected to remain tight through the winter and into spring.

Usage also spiked in parts of North China, including Beijing, which last Tuesday evening posted a record high winter usage rate of 21.56 gigawatts.

Contact reporter Yang Ge (geyang@caixin.com) and editor Joshua Dummer (joshuadummer@caixin.com)

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