China says three regions failed to meet energy efficiency targets last year

Environment

A worker drives past a chemical plant at an energy and chemical base in Ningxia Hui Autonomous Region, China July 24, 2018. Picture taken July 24, 2018. REUTERS/Stringer

SHANGHAI (Reuters) – A group of three Chinese regions failed to meet their targets to curb energy consumption growth and improve efficiency last year, the country’s top planning authority said in a notice published on Wednesday.

Liaoning province in the rustbelt northeast and the big coal producing regions of Ningxia and Xinjiang in the northwest failed to meet targets to cap rises in energy use and reduce the amount of energy consumed per unit of economic growth, the National Development and Reform Commission (NDRC) said.

China has been trying to fashion what it has called an “energy revolution” in order to ensure the economy continues to grow without significant increases in fossil fuel consumption, carbon emissions and pollution.

It aims to keep annual primary energy consumption at less than 5 billion tonnes of standard coal by 2020, up from 4.5 billion tonnes last year. It has also said it would cut energy intensity – the amount consumed per unit of economic growth – by 15 percent over the 2016-2020 period.

Though 12 provinces and regions exceeded their targets last year, some have continued to struggle. Liaoning, an old industrial base dominated by sectors like coal, oil and machinery, has struggled to diversify and its economy has been one of the country’s worst performers.

Meanwhile, Ningxia and Xinjiang are emerging as major new coal and electric power suppliers as traditional “energy bases” near the eastern coast come under greater pressure to curb air pollution.

China is trying to encourage regions to make greater use of clean and renewable energy resources, and it said on Tuesday that it would implement a new renewable energy quota system and improve grid access for wind, hydro and solar generators.

Meanwhile, state news agency Xinhua said on Tuesday, citing research from a government think-tank, that traditional coal-fired power plants are coming under increasing financial pressure as cleaner rivals become more competitive and their fuel, financing and environmental compliance costs increase.

According to research by the China Institute for Reform and Development, nearly half of China’s thermal power generators are facing losses as a result of their inability to pass higher costs onto consumers, with many turning into “zombie enterprises” after being forced into a “vicious circle” of debt.

Reporting by David Stanway; Editing by Kenneth Maxwell

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