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Power shortages return to China amid bad weather, surging demand

China's power woes

Extensive power cuts in China have led to a dent in the economic activities. Several factories have had to cut down their production. China has been in the middle of an acute power crunch for the last few months. A rise in coal prices has resulted in supply constraints.

Besides, CNN in a report in June also said that “extreme weather” and “surging demand for energy” have also led to power shortages. The report added that this is “the worst energy shortage in China since 2011, when droughts and surging coal prices pushed 17 provinces or regions to curb electricity use.”

According to Global Times, nationwide power curbs, caused by many factors including a steep jump in coal prices and surging demand, have led to side effects at Chinese factories of all kinds, with some cutting output or halting production entirely. “Industry insiders predict the situation could worsen as the winter season draws near,” the news organisation said.

It added that as the electricity supply tightens in the winter, the National Energy Administration held a meeting to address the situation and figure out ways to ensure continuity of coal and natural gas production in order to guarantee power supplies.

Analysts said that the uncertainty arising due to power shortage has come just when the country is trying to steer through the Evergrande debt crisis. The Chinese economy had started to show strong signs of recovery this year as it was gearing up for a post Covid era.