SYou can’t remember it being this hot in late August in any previous year, say senior Shanghai residents. On Monday, the city of 26 million people had a peak temperature of 43 degrees at midday. The air conditioning systems are running at full speed and are drawing massive amounts of energy from the grids. But while only parts of the night lights on the Bund waterfront promenade have been switched off in Shanghai to save electricity, the disaster is spreading in many other parts of China.
Because of the drought in regions such as western Sichuan, the state is cutting off electricity to factories and sometimes homes for longer than planned. Daytime temperatures of often more than 40 degrees have led to a sharp increase in electricity demand, the Sichuan government has now announced. Observers say it hasn’t been this hot and dry in the province in China’s hinterland for six decades. Since July, the rainfall along the Yangtze River, which runs through the region to the coast, has been around half below average, the lowest since 1961.
Not the first power outages in China
Sichuan gets 80 percent of its energy from hydroelectric power. As a result, many companies in the region report that the government not only cut off their electricity as planned until last Saturday, but also wants to paralyze the factories until Thursday. Thousands of production sites are estimated to be affected. In other parts of China, too, factories and households have had their electricity cut off in recent days as a result of the drought.
The country had to struggle with power outages for months last year. At that time, it was primarily the government that caused the energy crisis by suddenly shutting down coal production all over the country in a completely unforeseen manner in order to achieve climate goals.
German companies had also complained that their power had been turned off for an indefinite period with a warning of a few hours. Lobby groups such as the European Chamber of Commerce informed the press about the situation in crisis meetings. The fact that the assembly lines in the People’s Republic stood still and Chinese products could not be shipped had an impact on the supply chains in many parts of the global economy. Months later, in November, the situation in the country began to return to normal.
So far, analysts have been reassuring that it won’t be that bad this year. A report by the investment bank Goldman Sachs said that the power outages could affect the production of aluminum and the processing of metals. This could, for example, delay the production of batteries used in electric cars. However, the impact on the economy will be “limited”, wrote the Beijing bank CICC.
