More curbs on coal for electricity

Tag : power Supplies

The government will further enforce the price controls on coal usedfor power generation, in a move to keep the prices in line and toensure supplies for thermal power plants.
"Thermal coal port prices at Qinhuangdao, Tianjin and Tangshan, thethree major ports or transshipment centers, cannot surpass thelevels on June 19, which stood at 860 yuan ($125.92), 840 yuan and850 yuan respectively for 5,500 kcal/kg grade thermal coal," saidthe National Development and Reform Commission (NDRC) in astatement yesterday.
Now thermal coal prices at Qinhuangdao port have surpassed 1,000yuan per ton, doubling the level at the beginning of the year.
On June 19, the government announced it would take temporary pricecontrol measures for coal. The move was aimed at relieving thefinancial burden of power producers.
"After the move, the rise in thermal coal prices has beeneffectively controlled," said the NDRC. "However, some coalcontracting prices still increased."
Soaring coal prices continue to be the major problem for China'spower producers. All the five leading power companies expect to seelosses in their power generation businesses.
Huaneng Power International Inc, the listed arm of the country'slargest power company China Huaneng Group, said earlier it wouldsee losses in the first half, despite a 13.43 percent increase inpower generation during the period.
Huadian Power International Corp, the listed arm of China HuadianCorp, has also said it expects to see losses in the first half inspite of a 65 percent growth in electricity production.
Shanghai Electric Power Co, which suffered the heaviest losses,forecast 560 million yuan in losses in the first half, comparedwith a net profit of 211 million yuan during the same period of2007.
Because of the soaring coal prices, China's leading power producershave all begun to eye clean energy. China Huaneng Group is nowdeveloping wind power plants in provinces such as Hainan,Guangdong, Jilin and Shandong, and the Inner Mongolia AutonomousRegion. Huaneng is also quickening its development of hydropowerand nuclear power.
The government raised the electricity tariff by 0.025 yuan per kWhfrom July 1. However, some analysts said the rise could not offsetpower companies' losses.
Some analysts said the price increase, however, could only cover 15percent of the losses in coal-fired plants.
China's major power plants produced 1.68 trillion kWh ofelectricity in the first half of this year, a year-on-year increaseof 12.9 percent, said the China Electricity Council.
This summer the country will see 16 gW of power shortages,according to the State Electricity Regulatory Commission.