According to Reuters on the 12th (hereafter Korean time), China, which is suffering from severe electricity shortages, announced a policy to liberalize electricity prices. The photo shows a transmission tower in Hebei Province, China in July. /photo = Reuters
China, which is suffering from severe electricity shortages, has announced a policy of liberalizing electricity rates to encourage electricity production.
According to Reuters on the 12th (hereafter Korean time), China’s National Development and Reform Commission (NDRC) announced that all electricity produced by coal-fired power plants will be supplied 100% through market transactions. Until now, only 70% of electricity from coal-fired power generation in China has been applied at market prices.
NDRC’s deputy director, Feng Xiaozhong, said at a press conference that “these measures were taken to alleviate operational difficulties for power companies and to encourage power plants to increase supply.” The Chinese government has also decided to ease some measures to curb coal power generation to reduce carbon dioxide emissions. Coal shortages and local government policies to curb carbon dioxide emissions were cited as the cause of recent power shortages in China.
Earlier, the Chinese government allowed electricity rates to rise by 20%. However, it seems that this level of measure has limitations, so the coal electricity rate liberalization card has been withdrawn. According to Radio Free Asia (RFA), China has reached the point of smuggling coal from North Korea.
On the Zhengzhou Commodity Exchange in China, the price of coal futures reached an all-time high of 1507.8 yuan (about 280,000 won) on the 12th. China relies on coal for 64% of its electricity generation.
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