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China Restarts Coal Mines To Keep Up With Power Demand

Operations at 53 shuttered coal mines in China will once again come to life, as China struggles to keep up with increased power demand, according to a statement by the National Development Reform Commission in China.

Last week, China announced it would restart 38 coal mines in Inner Mongolia. Now, China has announced it will resume operations at 15 more coal mines, in the regions of  Shanxi and Xinjiang. The mines will operate for a year and will produce as much as 44 million tons of coal, which China hopes will satisfy the growing calls for power amid an intense heatwave and tick up in industrial activity.

China has struggled to answer the calls for both increased power and decreased emissions.

The news coincides with a scathing UN report that suggested this week that unless the world takes immediate large-scale reductions in greenhouse gas emissions, there will be no way to limit global warming to 2-degrees Celsius above pre-industrial levels.

Despite bringing a multitude of coal mines back online, China has warned that its power shortage situation is just beginning—in fact, it is expected to worsen.

This also means that its thermal coal prices are expected to stay high. In May, China’s thermal coal prices skyrocketed to new record levels.

Still, coal is a cheap power source that has given China a rather ironic advantage when it comes to manufacturing solar panels used in Western countries, the Wall Street Journal pointed out at the end of July.

One could view the push for solar power in the United States and Europe as triggering increased demand for coal power in China, even to the point of restarting its previously shuttered mines.

By Julianne Geiger for Oilprice.com

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  • Mamdouh Salameh on August 10 2021 said:
    When it comes to economic and energy needs, a major economy like China will override environmental considerations and continue to burn coal. This isn’t limited to China. Germany which is a forerunner of energy transition is being forced to consume increasing volumes of coal to generate electricity since renewables can’t satisfy its electricity needs.

    Despite its excessive pollution, coal is still a cheap and major energy source. Countries like China, Germany, Russia and the United States with sizeable reserves aren’t going to abandon it altogether no matter what climate change advocates and the IEA say.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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