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China is suffering big problems in its move to replace coal usage with natural gas. as power producers struggle to obtain supplies and an entire province has decided to pause switching homes and industries to gas over fear of heating stoppages.
Four of China’s biggest power producers sent an “emergency report“ dated Jan. 22. to the National Development &. Reform Commission. China’s top economic planner. requesting help with coal supply. according to China Business News.
And Hebei Province. which surrounds Beijing. will cease approving coal-to-gas conversions in rural areas until a new natural gas supply can be secured. the South China Morning Post (SCMP) reported.
China has struggled for two years with President Xi Jinping’s drive to reform the country’s coal industry and use cleaner fuels.
Efforts to limit coal supply in 2016 and encourage gas use last year overshot goals. causing price spikes and supply squeezes that sent regulators scrambling to restore balance. SCMP reported.
“With or without the urgent call from the power utility companies. the government is already doing what it can to ensure coal supply. including relaxing limits on imports and asking miners to take fewer days off around Lunar New Year.“ Zeng Hao. an analyst with Shanxi-based Fenwei Energy. told the SCMP. referring to the week-long holiday that starts on Feb. 16.
While the National Bureau of Statistics said coal’s role in China`s total energy consumption fell last year. the world’s biggest producer and user of the fuel is targeting reducing its share to 58%. by far still its biggest energy source.
Meanwhile. the pause in approving new coal-to-gas conversions in Hebei is “mainly to digest“ unfinished projects still in the works. Lin Chen. an analyst with Nomura. wrote in a research note.
Hebei. China’s sixth-largest province by population. overshot its goal last year of converting customers to gas. switching more than 2.5 million households. compared with a target of 1.8 million.
Such conversions led to shortages of natural gas and forced the government to let residents burn coal for heating.
