China

China official tells grid firms to prioritise residential users amid power crunch

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A power station of the State Development & Investment Corporation (SDIC) is reflected in a lake in Tangshan, Hebei province, China, August 22, 2018. REUTERS/Thomas Peter

SINGAPORE, Oct 1 (Reuters) - A top official of China's state-asset regulator said on Friday the county's power supply situation remains challenging and urged grid firms to prioritise residential use and ensure safe operation as winter approaches, said the State Grid Corporation of China (SGCC).

In a meeting with top executives including from the SGCC, Hao Peng, director of the State Assets Supervision and Administration Commission (SASAC) asked grid firms to closely monitor supplies of thermal coal, natural gas, hydro and wind power, said SGCC, the country's largest grid operator.

Beijing is scrambling to deliver more coal to utilities to restore supply, as nearly two-thirds of Chinese provinces grapple with power rationing. China's northeast provinces Liaoning, Heilongjiang and Jilin - home to nearly 100 million people - have been particularly hard hit. read more

Earlier this week, State Power Investment Corp (SPIC), one of China's top five power generators, urged its plants to boost coal supplies and generate more power for the northeast provinces at an emergency meeting.

In response to mandates from the State Council, or China's cabinet, SPIC told its subsidiary coal and power producers to prepare contingency plans for winter energy supplies, the firm said on its official WeChat account on Thursday.

"Communications among company-owned coal miners in the northeast region shall be enhanced and production for thermal coal shall be boosted," SPIC said.

"Every single plant needs to set up its own contingency plan and enhance communications with the state grid."

In Liaoning province, the State Grid will in the next few days connect two thermal power generators with 650 megawatts capacity, to be followed soon by another three generators with 1.3 gigawatts capacity, state-run Xinhua news agency reported earlier on Friday.

China is in the grip of a power crunch as a shortage of coal supplies, toughening emissions standards and strong demand from manufacturers and industry have pushed coal prices to record highs and triggered widespread curbs on usage

Thermal coal futures closed up 4.2% on Thursday on the Zhengzhou Commodity Exchange, after hitting an all-time high of 1,408 yuan ($218) per tonne, having doubled between July and September.

The government has called on power plants to raise coal imports in an orderly manner. Meanwhile, state-run oil and gas firms are seeking more cargoes of LNG, a key heating fuel for north China.

Sinopec Corp said on Thursday it plans to raise imports of LNG for the coming winter heating season by 9% versus a year earlier.

Additonal reporting by Brenda Goh in Shanghai; Editing by Rashmi Aich and Ana Nicolaci da Costa

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