As Winter Tests China’s Power Supplies, Guangzhou and Shanghai Deny Rationing

What’s new: Electricity providers in Guangzhou and Shanghai, two of China’s largest cities, have denied that they are rationing power, shooting down rumors that began circulating after local outages earlier this week.

The Shanghai electricity provider put out a statement Tuesday confirming it had indeed put out a notice of a power stoppage set for that day. But it said the action was being taken for maintenance reasons, despite rumors of short supplies.

Also this week, the Guangzhou electricity provider put out a statement saying that users in parts of the city had lost power in the early hours of Monday morning due to an equipment malfunction. It added that power was restored less than two hours later.

What’s the background: Stories about power rationing have been making front-page headlines in China for much of the last week following a cold snap in the nation’s central region that led a number of major cities and provinces to resort to such rationing.

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 buying from Australia, a leading supplier, has stopped amid recent trade frictions.

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Contact reporter Yang Ge (geyang@caixin.com)

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