As the rest of the world tries to tackle the European Union’s proposed carbon border adjustment mechanism (CBAM) – which calls for levies on non-European products based on their integrated carbon footprint – the China, on the other hand, is currently grappling with a slightly different energy problem.
A massive heat wave in parts of the country, coupled with a coal shortage due to China’s feud with Australia’s main supplier, has pushed up coal prices.
China to increase coal production
Today, China, the world’s largest coal consumer, plans to add nearly 110 million tonnes (MT) per year of advanced production capacity in the second half of this year to meet growing demand for coal. .
This Economic Times reported that China’s National Development and Reform Commission (NDRC) said about 400 MT of coal mining capacity is under review for government approval. Another 70 MT capacity is also under construction and would be launched gradually.
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In addition, the Chinese state planner has asked power plants to build up their coal stock to the equivalent of at least seven days of consumption by July 21. Reuters news agency said the Chinese government was doing its best to ensure the supply of electricity to coal-fired power plants. in a context of increasing energy consumption by industrial and residential users.
In the first half of 2021, China has already added more than 140 MT of coal mining capacity.
Eleven provinces recorded a record electric charge a few days ago, the Economic Times reported, as the heat wave led to increased use of electricity. In the first six months of 2021, energy consumption increased 16% from the previous year, the report adds.
While simultaneously increasing the coal capacity, the NDRC reduced its obsolete coal capacity. Where there were once 10,000 coal mines in China in 2015, there are now around 5,000. The NDRC has urged coal miners to build advanced mining capacity and increase production.
China’s average daily coal consumption rose to more than 2.2 MT at major power plants in at least eight Chinese provinces as of July 15, Reuters reported.
Meanwhile, the South China Morning Post quoted the NDRC as saying China will release more than 10 MT of coal from its state reserves.
By AG Metal Miner
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