A deadly heat wave across Asia is stretching electricity grids from southern China up to Tokyo and Seoul, sending prices to multiyear highs and sparking warnings of more power stress to come.
A deadly heat wave across Asia is stretching electricity grids from southern China up to Tokyo and Seoul, sending prices to multiyear highs and sparking warnings of more power stress to come. Japan on Monday breached records above 41 degrees Celsius (106 Fahrenheit) as the heat that’s been blamed for at least 15 deaths this month pushed electricity rates to the most in almost five years. The Korea Meteorological Administration issued a nationwide heat wave warning after temperatures on Sunday hit the highest since 1994. Chinese authorities continue to warn that peak power loads have already breached last year’s levels and are expected to rise further.
The summer temperatures scorching Asia, home to the world’s biggest coal and natural gas consumers, have also struck northern Europe, threatening crops and forcing Sweden to seek help from Italy and France to combat wildfires, as well as North America, with Texas sizzling under record heat.
Regulators in China have warned in recent weeks that higher temperatures, which they’ve pegged on climate change, and solid economic growth are setting the stage for a possible electricity crunch this summer. The governor of southern Hunan province convened an emergency meeting Sunday to address the “very severe” electricity supply situation, which has forced government buildings to keep air conditioners at 26 Celsius or higher.
“More electricity is used by households to run their air conditioners, sometimes for 24 hours a day, amid high temperature,” said Tian Miao, a Beijing-based analyst from Everbright Sun Hung Kai Co. “This, along with electricity used for industries, may form concentrated power loads and lead to a short-term supply shortfall” in some Chinese regions.
Daily coal consumption at China’s six major coastal power generators rose to the highest since February on Saturday, according to Bloomberg calculations of China Coal Transport & Distribution Association data. Temperatures of between 38 and 40 degrees Celsius are forecast for most areas in the country’s central and east for as long as the next eight days, according to China’s National Meteorological Center.
Tokyo topped 34 degrees Celsius (93 Fahrenheit) every day since July 14, after only breaching that twice last July, according to Japan Meteorological Agency. The nation’s 24-hour spot price rose 25 percent to 26.16 yen per kilowatt hour for delivery on Tuesday, the highest since August 2013, according to the Japan Electric Power Exchange.
“With the heat wave coming in, people are using more air conditioning, and that is where the demand goes up and as does the prices,” said Bikal Pokharel, an analyst at Wood Mackenzie Ltd.
In South Korea, seven people died and about 550 people were hospitalized with heat-related illnesses during July 15-21, according to the Korea Center for Disease Control & Prevention.