November 7, 2010 / 4:26 AM / 9 years ago

China energy steps spur diesel shortage - media

BEIJING, Nov 7 (Reuters) - Forced power outages aimed at meeting China’s energy-saving goals have led to “unprecedented” diesel shortages, as companies buy diesel generators to keep operating, the Xinhua news agency reported on Sunday.

China is fast approaching its self-imposed end-2010 deadline to reduce its energy intensity — or the amount of energy used to make each unit of GDP — by 20 percent from 2005 levels. But after falling behind on efforts to reach that goal, many local governments are now taking drastic measures to catch up.

“In a hurry to meet their regional targets assigned by the central government, many local governments chose the blackout method for enterprises in the remaining two months,” Xinhua reported.

“This method quickly spread to many provinces around China.”

Conservation efforts in some areas have actually worked against the main goal of reducing energy use, the news agency reported, citing industry officials. When power supplies were cut off at some enterprises, those companies simply purchased diesel-powered generators to allow them to continue operating, thereby exacerbating the diesel shortage, it said.

The news agency said thousands of gas stations across the country have “sold out” signs for diesel or long lines of vehicles waiting at stations that still have supplies.

The China Chamber of Commerce for the Petroleum Industry said more than 2,000 privately owned gas stations in southern China had shut down due to a lack of diesel.

In the industrial Pearl River Delta and the Yangtze River Delta regions, hundreds of gas stations were awaiting diesel deliveries, Xinhua said.

“The blackout is not a wise choice. What the local governments need to do now is to pay attention to change the mode of economic growth with high efficiency and low energy consumption,” Zhong Yongsheng, deputy director of the Center for China’s Urban-Rural Development Studies, told Xinhua.

Last week, China’s top two refiners, PetroChina (0857.HK) and Sinopec Corp, said they were processing fuel at top rates this month, and a trader said Sinopec was slashing diesel exports to cope with the domestic shortage. [IDn:TOE6A4016] (Reporting by Ken Wills; Editing by Alex Richardson)

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