China’s power crunch worsens, factories and households in northeast regions hit by unannounced power cut

China’s power crunch is worsening, with factories and households in the country’s northeastern regions, including the provinces of Heilongjiang, Jilin and Liaoning, experiencing unannounced power cuts.

Industry insiders say the power supply shortage is expected to intensify further as the winter heating season draws near.

Residents of Jilin city, in Jilin province, said that their power supply has been intermittent recently, noting that the unstable power supply started on Saturday but did not receive any notice in advance. 

A resident in Dalian city, Liaoning province, said that he received notice about the coming power cuts starting from Monday in his area. The notice said the power cut was due to equipment maintenance but did not reveal when the power outage will end, according to the resident.

On Friday, authorities in Liaoyang, Liaoning province, suddenly cut the electricity supply of a factory operated by Liaoning Penghui Zhuye, a steelmaking and metal casting firm, according to local media reports.

This shut down the exhaust system of the factory’s two blast furnaces, resulting in 23 people inhaling carbon monoxide. All the affected workers are still being treated in hospital on Monday, according to state broadcaster CCTV.

On Sunday, a water supplier in Jilin City, in northeastern Jilin province, announced on its public WeChat account that national and regional directives to restrict power use meant “irregular, unplanned and unannounced power outages will continue until March 2022”.

“Power outages and water outages will become normal, which will result in the inability of nine pumping stations to supply water normally,” Jilin City Xinbei Water Supply said.

An employee at the State Grid Corporation of China, the country’s largest state-owned electricity utility, said power rationing in the northeast was imposed first on non-residential areas but this had failed to resolve the shortages, according to The Beijing News .

To prevent the entire power grid from “collapsing”, restrictions had been extended to residential users, according to the report.

Liaoning province said power generation had declined significantly since July, and the supply gap widened to a “severe level” last week. It expanded power cuts from industrial firms to residential areas last week.

The city of Huludao told residents not to use high energy-consuming electronics like water heaters and microwave ovens during peak periods, and in Harbin city, capital of Heilongjiang province, many shopping malls were closing earlier than usual at 4 p.m. local time.

The Jilin and Liaoning provincial governments held meetings on Sunday to discuss the power outages. Wu Jinping, a member of the Jilin provincial Communist Party standing committee, said the provincial government should import more coal and arrange for the province’s coal mines to “safely unlock their production capacity”.

“It is necessary to formulate emergency plans to prevent the occurrence of systemic and regional long-term concentrated power outages,” Wu was quoted as saying in a provincial government statement.

Tight coal supplies and toughening emission standards have driven the power shortages across China. China has vowed to cut energy intensity by around 3 per cent in 2021 to meet its climate goals. Provincial authorities have also stepped up the enforcement of emissions curbs in recent months after only 10 of 30 mainland regions managed to achieve their energy goals in the first half of the year.

The sharp worsening power crunch in northeastern China came after a power pinch has affected manufacturers in key industrial hubs on the eastern and southern coasts for weeks. At least 15 listed Chinese companies have disclosed in exchange filings that production had been disrupted by power curbs.

The steel, aluminium and cement industries have also been hard hit by the output curbs, with about 7 per cent of aluminium production capacity suspended and 29 per cent of national cement production affected, Morgan Stanley wrote in a Monday note.

Nomura cut its third and fourth-quarter GDP growth forecasts to 4.7 per cent and 3 per cent, respectively, from 5.1 per cent and 4.4 per cent previously, and its full-year forecast to 7.7 per cent from 8.2 per cent.