Plan for coal stocks to ease supply woes
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Battling its worst power shortages in years, China will select qualified coal and power producers to help build emergency coal stockpiles in a bid to ease supply disruptions.
The coal emergency reserves will be set up in central and southwestern regions, according to the National Development and Reform Commission Wednesday. They will also be built along rivers and the eastern coastal regions.
The coal stockpiles will benefit areas that lack the fuel or are highly dependent on hydropower, the NDRC, China's top economic planning agency, said in a statement posted on its website.
To qualify as part of the emergency stock program, coal companies should have an annual capacity of at least 20 million tons while power firms should have a minimum generating capacity of 1 gigawatt, the NDRC said.
The country's power shortfall could reach as much as 40 gigawatts this summer, worse than 2004 when the country sweltered through its worst crunch in decades, the State Grid Corp of China has said.
This year's shortages began as early as March after surging coal prices eroded power generators' profitability and also due to insufficient generation capacity and transmission problems. The situation has prompted the government to raise power tariffs by 3 percent for industrial and commercial users in 15 provinces from yesterday.
In April, China approved the setup of the first phase of the nation's emergency coal reserves of 5 million tons. China Shenhua Energy Co, the nation's largest coal miner, said then it will provide 1.7 million tons which will be based at four ports.
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