Chinese authorities have called on several thousand coal mines to maximise their production to find a quick fix for the ongoing energy shortage that has caused blackouts in most of the provinces.

Tight energy supplies and attempts to introduce environmental regulations have led to recent power rationing in some parts of the country, impacting normal economic operations and people's livelihoods, the State Council said late last week.

The comments from China's highest governing body follow power outages in September that interrupted factory production and hit families in some regions.

Are you missing out on ACCELERATE?
Gain valuable insight into the global oil and gas industry's energy transition from ACCELERATE, the free weekly newsletter from Upstream and Recharge.

Last week, the National Development and Reform Commission (NDRC), the country’s powerful economic decision making body, urged coal miners and power utilities to sign up to new agreements to resolve the problem.

In line with the NDRC’s directive, Inner Mongolia, Shanxi, and Shaanxi, the country's top three coal producing provinces, have agreed to deliver 145 million tonnes of coal in the fourth quarter.

Inner Mongolia alone has ordered 72 mines to boost production by a total of 98.4 million metric tonnes, which is about 30% of China's monthly coal production.

In Ordos city, in the country’s north, local government has facilitated the approval procedures for new coal mine production to ensure supply, having rubber-stamped 107 coal mines for temporary land use approval, which will raise local coal production capacity by 169 million tonnes.

By October, the city had 225 coal mines in normal production, with a total production capacity of 640 million tonnes a year.

Balancing rising demand with climate commitments

Power demand is soaring in China as the world's top energy consuming country has emerged from lockdowns following the global Covid-19 pandemic.

However, efforts to ramp up coal production runs counter to the country’s pledge to cut emissions beyond 2030 and achieve carbon neutrality by 2060.

The country relies on coal to supply almost 60% of its energy. It is still largest energy source for heating, power generation and steel making.

Earlier this year, China began closing hundreds of coal mines and declined to approve new ones in a nationwide drive to push for more renewable energy, resulting in a coal supply crunch that has crippled power generation.

China holds some of the world’s largest coal reserves and is the world’s top coal producer, with domestic production last year rising 0.9% year on year to 3.84 billion tonnes.

China plans to slash coal consumption to 5% of its energy mix by 2060, from 56.7% now.

Industry activities account for 71% of China’s total power consumption, which stood at 5.39 trillion kilowatt hours, up 11.3% year on year, in the first nine months this year, with household consumption representing only 13.6%.