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China brings back coal switching

The central government has unveiled plans to switch out coal in heating
systems across northern China, this time for a range of cleaner energies

COMMENTARY CHINA has returned to its strategy of switching
out coal for natural gas, confident in its ability to
meet the surge in winter demand the transition
WHAT: will bring.
The Chinese Ministry of The Chinese Ministry of Ecology and Envi-
Ecology and Environment ronment aims to replace coal with cleaner
wants to convert coal- sources of energy – including gas – in the heat-
fired systems that heat ing systems of 7.09mn households by the end of
7.09mn households. this month.
The return to a programme that left homes
WHY: and business without vital gas supplies in the
The government wants to depths of the 2017-2018 winter highlights the
cut the northern regions’ government’s confidence that it is better placed
pollution levels. this time around to overcome energy supply
chain challenges.
WHAT NEXT:
Beijing should be able to Winter of discontent
pull off the switch without The ministry said on September 28 that the
triggering gas supply proposed plan had been submitted to a range
shortfalls of central and provincial government depart-
ments – including the National Develop-
ment and Reform Commission (NDRC) and
National Energy Bureau (NEB) – for feedback
before September 30.
The environment ministry’s latest plan will the city-gate gas price will be capped during the
see households in the northern Beijing-Tian- northern heating season.
jin-Hebei (BTH) metropolitan region as well The central government has a somewhat
as Shanxi, Shaanxi, Shandong and Henan prov- checkered past when it comes to coal conversion
inces converted to clean coal, electricity and efforts, however, with efforts to switch 4.74mn
gas. Government subsidies will be available for households from coal to gas heating ahead of
rural conversions to gas and electricity, while the 2017-2018 winter leading to acute supply
shortages. Colder-than-expected temperatures
drove gas demand beyond the capacity of the
country’s supply system, exposing inadequacies
in the country’s pipeline and storage network.
Heavy demand for liquefied natural gas (LNG)
road tankers ended up sending road truck rates
soaring.
Insufficient supply and inadequate infra-
structure meant industrial users’ gas volumes
were diverted to the residential sector, leading
many businesses to temporarily close as a result.
Several years of investment in new domes-
tic pipeline capacity, new LNG and piped gas
import capacity as well as the development of
underground gas storage capacity, however, have
convinced Beijing that the gas supply chain will
not break this time around.

Green goals
The ministry made it clear that it wanted to meet
this year’s air pollution targets set out in the cen-
tral government’s three-year Blue Sky Defence
action plan unveiled in July 2018.

P14 www. NEWSBASE .com Week 40 08•October•2020