China: the energy crisis continues and the closure of companies in Sichuan
China extended Sichuan's industrial production shutdown obligation for another five days , as heat waves and extreme drought in southwestern regions have increased demand for electricity while reducing hydroelectric power generation in the country. province which is the largest producer.
The heat wave in Sichuan province and the rest of southwestern China has come on the eleventh day of constant alert from the authorities. With the scorching temperatures, the demand for electricity from homes has increased. But the heat wave and the worst drought in the past sixty years have exhausted the hydroelectric reservoirs in Sichuan province, the main producer of hydroelectricity. As a result, authorities are imposing limits on electricity and reducing working hours in shopping malls to save electricity.
In Sichuan, hydroelectric power generation from the Yangtze River is declining and factories are closing to ease the pressure on the grids. Sichuan is not only the province most dependent on hydroelectricity, but it is also an exporter of electricity generated from this source, so there are also energy consequences in other areas.
The Chinese province of Sichuan is not only a major producer of hydroelectric power, but is also home to many factories that produce polysilicon and process lithium, two key components of the solar and battery industries respectively. According to analysts, the lack of energy and the shutdown of factories will tighten the market for these materials and drive up prices.
The closures were originally supposed to last until August 20, but authorities extended the electricity suspension to Sichuan industries until August 25, Caixin economic news agency reported Monday. The provincial government of Sichuan issued the highest possible emergency alarm on Sunday for the lack of electricity, Caixin said.
All these will affect the performance of the Chinese economy in general, and therefore can also explain the current expansionary Chinese economic policy.
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The article China: the energy crisis continues and the closure of companies in Sichuan comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/cina-prosegue-la-crisi-energetica-e-la-chiusura-delle-aziende-nel-sichuan/ on Wed, 24 Aug 2022 06:00:06 +0000.