China’s Hebei to ensure clean coal supply for 2018-2020 winters

30-Oct-2018

China’s Hebei province has said it will ensure sufficient supplies of clean coal during the next three winters to avoid heating fuel shortages and reduce toxic air emissions.

Several regions of China encountered fuel shortages last winter as Beijing pushed to switch millions of households to natural gas from coal as part of its anti-pollution campaign, leaving many thousands of households without heat.

In August this year, Chinese Vice Premier Han Zheng urged authorities to be “realistic” in their winter anti-pollution campaign, and “steadily promote clean winter heating in Northern China and ensure people are safe and warm.”

Hebei, which surrounds capital Beijing and major port Tianjin, is a key battlefield of the clean air effort. It will offer for purchase this winter 18.2 million tons of clean coal, including anthracite or blue coal, to 9.1 million households without access to clean-energy heating, according to a statement on the central government website on Friday.

In 2019, Hebei will offer 12.8 million tons of clean coal and 7.4 million tons in 2020.

Hebei said it has signed contracts with major coal miners such as China Shenhua, Shanxi Jincheng Anthracite Mining Group [SJAMG.UL], Shaanxi Coal and Chemical Industry Group [SHAANB.UL] to ensure the supply of clean coal.

“Local authorities should urge coal mining companies to operate under full load and improve transportation networks to guarantee coal supply to all the households in need,” the government statement said.

The province also said it will offer subsidies for residential clean coal use during heating season at around 500 yuan ($71.85) a ton.

Current anthracite coal spot prices in China are around 1,140 yuan a ton, while thermal coal prices are around 650 yuan a ton, according to Zheshang Securities.

The most-active thermal coal futures were at 633 yuan a ton on Friday.

A total of 3.62 million households will be converted to natural gas or electrical heating from coal this year, including 1.74 million that are in Hebei.

Clean coal has less dust and fewer emissions when it burns compared with normal thermal coal.

Source: REUTERS