The southwestern province of Sichuan, China's biggest hydropower producer, has seen its supply capability slump due to a long drought across the Yangtze basin, stoking fears the country could suffer another devastating power shortage.
Sichuan's accounts for 30% of China's total hydroelectric generation and it normally delivers a massive power surplus to the rest of the country. But it is now receiving electricity from other provinces after weeks of minimal rainfall and extreme temperatures in excess of 40 Celsius .Register now for FREE unlimited access to Reuters.comHydropower is the biggest source of electricity supply in Sichuan, accounting for more than 80% of total power production.
Though Sichuan has abundant coal stocks, coal-fired power makes up just 16% of its total power capacity, not enough to meet the supply-demand gap. Despite local shortages, Sichuan stills needs to fulfil part if not all of its cross-provincial power transmission contracts, which the grid usually treats as a priority.Industrial plants in a wide variety of sectors in Sichuan and neighbouring Chongqing - including well-known names like Taiwan's Foxconn and battery giant CATL - have been ordered to shut down or curb output since mid-August to conserve power for household users.
But analysts say the power crunch this year will be less severe than the one from last September and October, when high coal prices and supply shortages hit more than 27 provinces and regions. Regional power rationing is expected to ease in September and October when temperatures fall. China's leading power-exporting regions, including Yunnan and Guizhou as well as Sichuan, mainly source their electricity from hydropower, which is becoming more volatile as a result of climate change.
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