“The Southwest region electricity shortage is at emergency level.” China Southern Power Grid, said in a statement released on Wednesday. The country's power grid is currently experiencing a shortfall of almost 15%, and the situation in 5 provinces in the south of the country, which are experiencing their worst power shortages in 5 years, is getting worse.

Analysts say that the power shortages are caused by both a lack of water to drive hydropower stations and coal to fire the thermal power stations. Some say that the government is likely to build more thermal power stations to deal with the energy shortages, but they also argue that until the price of coal and electricity are linked, the lack of adequate power supply is likely to be a persistent problem in these 5 southern provinces that include Guangxi, Yunnan and Guizhou.

Source

China Securities Journal

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