China rations electricity as heat wave causes factory suspensions

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BEIJING — China’s worst heat wave in six decades is deepening the economic pain of pandemic shutdowns, with authorities this week ordering factories to suspend production in several major manufacturing regions to save electricity.

Sichuan province, home to more than 80 million people, said Monday that factories in 19 cities and prefectures would halt operations until Saturday to reserve power for “people’s use”. Other regions in southern China have also ordered that electricity be given priority to run air conditioners.

The factory suspensions reflect how climate change is intensifying China’s economic challenges. Officials have warned the country risks missing its 5.5% growth target for the year as coronavirus shutdowns disrupt trade and normal life.

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On Tuesday, Jin Xiandong, spokesperson for the National Development and Reform Commission, said China must rely more on coal for electricity because the heat wave and drought were drastically reduce hydroelectric production.

Ferocious heat waves like the one this summer are expected to become more common in China as climate change worsens. Eleven provinces currently have warnings in place for temperatures above 104 degrees Fahrenheit. Chongqing, a self-administered city surrounded by Sichuan province, hit a record high of 112.1 degrees over the weekend, with highs of over 104 degrees expected to continue for about a week.

China, the world’s biggest emitter of carbon dioxide, has sought to portray itself as a global leader in climate action, touting its shift to electric vehicles and other measures. But the country continued to build new coal-fired power plants. This month, Beijing suspended bilateral climate talks with the United States in retaliation for House Speaker Nancy Pelosi’s trip to Taiwan.

Dangerously high temperatures have left nations around the world struggling this summer, with dry heat causing fires in Britain, a power grid outage in Iraq and more than 1,000 deaths in Portugal. Last month, President Biden called climate change an “emergency”.

The inland province of Sichuan in China has become an international manufacturing hub in recent years due to its lower production costs compared to coastal areas. The region produces and exports items including electronics, furniture, and food. State media reported that Sichuan marked its highest electricity consumption month on record in July.

As the production shutdown took effect abruptly on Monday, factories scrambled to understand the financial effects.

Tongwei Solar, the world’s largest producer of crystalline silicon solar cells, has experienced disruptions at its three production bases in Sichuan, a public relations officer for the company told The Washington Post by phone, declining to be named.

“We are now cooperating with relevant ministries to adjust power consumption in an orderly manner and always assess specific impacts,” he said.

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Foxconn, a major assembler for Apple, told the China Securities Journal that “the effect would not be material to the company’s operations.” Foxconn manufactures some Apple products, such as iPads and Macs, in Sichuan.

A Sichuan fertilizer maker, Lutianhua, posted a notice on the Shenzhen Stock Exchange on Monday, saying it expected a net profit of $4.4 million due to the production shutdown.

High temperatures could continue unabated until the end of the month, according to China’s National Meteorological Center.

China released its latest economic data for July on Monday, which showed rising unemployment rates and a slowing economic recovery as new coronavirus outbreaks and the heatwave wreaked havoc. Youth unemployment reached a record 19.9%.

Fu Linghui, spokesman for China’s National Bureau of Statistics, told a news conference on Monday that high temperatures in the south had caused “adverse effects on economic operations”. He also said the effect of the pandemic on businesses meant they were unable to offer as many jobs to young people as before.

“The momentum of economic recovery has slackened slightly, and the foundations for consolidating economic recovery still need to be strengthened,” Fu said.

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Underlining Beijing’s concerns about the economy, China’s central bank unexpectedly lowered a key rate this week.

The country’s leaders had hoped for better economic performance this year, ahead of a crucial Chinese Communist Party congress in the fall, where leader Xi Jinping is expected to break precedent by staying on for a third term. But Xi has made it clear in recent months that he will not lift China’s “zero covid” policy despite the costs.

With foreign tourism still largely suspended, Beijing had encouraged families to take national holidays during the summer to support consumption. But the surge in travel has led to coronavirus outbreaks across the country, prompting closures in some vacation destinations like the resort town of Sanya, Xinjiang’s capital Urumqi, and parts of Tibet.

China’s policy of quarantining any close contact of a covid patient also continues to disrupt daily life. Videos of shoppers fleeing an Ikea store in Shanghai were widely shared over the weekend after news broke that those there would be forced to self-quarantine because a close contact of a covid patient had visited the shop.

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