China’s record coal spree seen preventing any new energy crunch

Coal bulker terminal at the port of Qinhuangdao. (Copyright Greenpeace | Liu Feiyue)

China is better prepared to avoid any energy supply crisis even with power demand forecast to continue to grow rapidly, authorities said.

A 10% lift in demand last year triggered a supply crunch in the second half and caused widespread electricity shortages, prompting a raft of government action to tame surging fuel prices, secure imports and boost local production.

The nation now has sufficient fuel supply to meet “reasonable domestic demand,” the National Development and Reform Commission, the county’s top economic planning agency, said Tuesday. A rush to accelerate coal output in the final months of 2021 pushed annual production to more than four billion tonnes, including a record December haul.

Utilities have also secured more longer-term coal contracts to manage price volatility, while gas suppliers are maintaining high inventories and have been able to meet home heating needs so far this winter without curbing flows to industrial users.

To support China’s adoption of wind and solar power, authorities will speed up approvals for giant, cross-regional power transmission lines and back the development of desert-based hubs for renewables, the NDRC said. President Xi Jinping in October announced the first 100 GW of projects in a desert build-out were already under construction.

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