Millions of Chinese are learning just how important coal-fired power is to their health, safety and comfort, thanks to Beijing’s ban on Australian coal imports.
High-quality Australian coal has helped fuel China’s miraculous industrial growth over the last generation. But the escalation of a trade spat between the PRC and the Morrison led Federal Government over the original source of the coronavirus has resulted in coal being added to a growing list of Australian exports which are no longer welcome in the Middle Kingdom.
Despite claims by wind and solar acolytes that China is well on its way to an all renewables powered future, apparently, the black stuff still matters.
China shivers as coal ban sparks electricity shortages
18 December 2020
Electricity shortages are worsening across China, forcing tens of millions of residents in large cities to ration heating, raising questions about how long Xi Jinping can continue to delay delivery of more than $1bn of Australian coal which feeds the nation’s power plants and steel mills.
Australia in 2019 supplied 57 per cent of China’s thermal coal imports for power stations and more than 40 per cent of the nation’s imports of coking coal, a key ingredient in steelmaking, according to coal researcher IEA Clean Coal Centre.
The electricity shortages have been causing increasing concern in Beijing as a mixture of booming industrial activity, protection of its politically powerful domestic coal sector and retribution against the Morrison government begins to affect daily life.
“You cannot pretend that bad relations between China and Australia haven’t contributed to this situation,” a Chinese energy industry source told The Australian, asking not to be named because of political sensitivity.
Residents in the industrial hub of Zhejiang — an east coast province of 57 million people which the Chinese President once ruled — have been instructed not to use heating until the temperature falls below 3C.
Some people in Hunan — which has a population 67 million and was the birthplace of Mao Zedong — have been forced to climb 20 flights of stairs to get to their apartments as power cuts prevent the use of lifts.
Restrictions on power usage have also spread to provinces including Shaanxi (population 33 million), Jiangxi (45 million) and Inner Mongolia (25 million), where temperatures this week have fallen below minus 40C.
Last week, Shanghai’s municipal government told shopping malls and office towers to switch off airconditioning and all unnecessary outdoor lighting. Shanghai’s signature light and laser show along both banks of the Huangpu River will reportedly soon be suspended indefinitely.
Over the weekend the National Development and Reform Commission met with major power companies to address surging domestic coal prices. In an attempted fix, the commission — China’s top economic planning agency — gave approval for power plants to import coal without clearance restrictions, “except for Australia”, according to state media.
The all-but-official ban on Australia’s $14bn annual coal exports to China is the biggest strike in Beijing’s sweeping eight-month-long attempt to use more than $20bn of trade restrictions to punish the Morrison government for calling for an independent inquiry into the coronavirus.
China’s state-controlled media has been reluctant to link the spike in coal prices and power restrictions to Beijing’s ban on coal imports, particularly from Australia.
The country’s industrial analysts have been more direct in articles to clients spread over Chinese social media.
“Many coastal power plants have renovated power units to use Australian coal,” wrote one Chinese industrial analyst firm, which also noted the “big gap in terms of quality” between Australian coal and that from Indonesia and Russia.
Former Nationals leader and trade minister Mark Vaile said: “It’s going to be interesting to see how the Chinese government deals with this. Their concerns are always about maintaining civil stability.
“If it’s Chinese government decisions that are causing power outages through a lack of supply of quality coal, well, that certainly will raise concerns in the community.” Mr Vaile is now chairman of coal company Whitehaven, which does not export to China.
China this year imposed strict restrictions on imports to help struggling local coal producers by increasing domestic prices.
Prices have skyrocketed since October on booming industrial activity in the world’s second-biggest economy and as cold weather hit much of the country earlier than usual, increasing demand.
While Chinese consumers have been hit, China’s coal-producing regions are booming.
“A sudden rise in demand has cleared out stock, leaving coal yards standing empty, and the roads are lined with trucks bearing the black gold,” reported Yicai, a Chinese business publication, after a visit to the central province of Henan this week.
Industry sources told The Australian the price of thermal coal in China had in recent days traded well above the price limit of 600 yuan ($120) per tonne set by Beijing’s economic planning agency over the weekend.
China’s Foreign Ministry has continued to deny that Australian coal has been black-listed, despite more than 70 bulk ships, carrying more than $1bn worth of Australian coal, being stuck for up to six months off China’s coast.
via STOP THESE THINGS
January 9, 2021 at 12:31AM