Economic Insider

Impact of China’s Energy Crisis Will be Felt by the World

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Photo Credit: CNN

Record-breaking temperatures carried on by heat waves have hurt businesses and neighborhoods for several weeks in China, especially in the province of Sichuan. Over 80 million people reside in a province in China’s southwest that is suffering from the effects of extreme heat.

Because of this, the Chinese government has instructed the temporary closure of factories in Sichuan in order to conserve electricity. Other actions taken by authorities include shutting down power lines in subways and offices during designated times, blackouts, and a reduction in the use of air conditioning.

As an outcome, the approaches caused considerable damage to the production of high-tech industries as well as farms that rely on energy to keep their goods fresh. According to experts, this will have a significant effect on global trade. Furthermore, neighboring cities such as Chongqing and provinces along the Yangtze River have begun to recognize the effects of the changes implemented by the authorities in Sichuan.

China has always taken pride in its economic diversity and wealth. Recent events, however, have surprised residents who have grown accustomed to the luxurious lifestyle China has provided for many years. Power outages, for example, reminded people of a time when China was not yet the industrial superpower that it is today.

Climate change has exacerbated the problem for citizens and the country, as it threatens China’s planned economic growth.

A Greenpeace climate adviser, Li Shuo, said, “These so-called extreme weather events will have more impact on our lives and electricity supply. And perhaps we all need to reconsider whether these extreme events will become the new normal.”

Read Also: US Farmers Clamor as Heat Damage Crops, Deplete Water Supply

The power crunch in Sichuan Province

Sichuan is a massive power source in China due to its proximity to the Yangtze, China’s longest and largest river. With the active flow of the river’s waters comes energy produced by the province’s hydropower energy plants. For decades, power plants have provided ample energy to the country, powering cities, homes, and offices.

However, when the temperatures climbed, reservoirs along the river dried up. The power stations were affected, and thus the power outage began. As a result, Sichuan’s hydroelectric capacity fell by 50% this month. This is expected to continue as long as the heat waves last.

“China’s electricity demand has been incredibly flat in the past because so much of it has come from the industry, not from households or services. Now with air conditioning becoming more common, the demand is becoming higher,” said Lauri Myllyvirta, a Finland-based Centre for Research on Energy and Clean Air lead analyst.

“At the same time, rains are becoming more errant. Heavy rains and periods of drought make hydropower much less reliable as a source of available capacity during those peaks.”

Read Also: Factories in China Shut Operations Amid Worst Heat Wave in Decades

The world is impacted by the energy crisis management of China

China’s response to its current energy crisis will have an impact on the rest of the world. Because the country is a place of residence for over 1.4 billion people, carbon dioxide emissions from the country account for 27% of global emissions. If the country continues to burn coal to combat the crisis, climate conditions may worsen.

“There is a possibility that power shortages caused by future extreme weather events might become a new motivation for China to approve more (coal-fired power) projects,” added Li.

Meanwhile, Global Energy Monitor researcher Yu Aiqui said, “There is a possibility that power shortages caused by future extreme weather events might become a new motivation for China to approve more (coal-fired power) projects.”

Analysts, however, believe that China’s shift to coal will be only temporary because the country desperately needs it. According to an energy consultant, “Capacity doesn’t equal generation. The capacity being there creates a lot of optionality and flexibility for all these other (renewable energy sources) they’re building. For now, I see the coal capacity additions, as for the most part, targeted at being able to support wind and solar.”

Source: CNN

Opinions expressed by Economic Insider contributors are their own.

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