Coal shortage leaves large parts of China freezing

A severe coal shortage has forced power cuts and rationing in large parts of north and central China as demand surged due to a cold snap across large swathes of the nation over the past week, media reports said on Monday.

In the northern province of Shaanxi, 14 major thermal power stations only had four days worth of coal stocks left, with reserves at two power stations already running out. Many plants and residents in Shaanxi had received notice of impending blackouts, with a 12,000-household compound in the provincial capital of Xian facing power cuts for the next 10 days.

Similar shortages have also gripped other provinces, including coal-rich Shanxi in the north and Henan in central China, as well as the southwestern mega-city of Chongqing.

China, which overtook Japan in the second quarter to be the world's second largest economy, relies on coal for 70 per cent of its fast-growing energy needs, and coal combustion has become one of the main sources of its air pollution.

Experts have blamed the shortages on soaring coal prices, insufficient logistics facilities and increasing transportation costs.

Cold weather and transport disruptions typically cause shortages in most years, but the problem has been complicated by coal producers' unhappiness over price controls that are crimping their profits.