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China eases coal use restrictions amid gas shortage, rising prices

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China eases coal use restrictions amid gas shortage, rising prices

Rising gas prices driven by cold winter weather and an increased demand for the fuel has prompted the Chinese government to ease coal use restrictions, the Financial Times reported Dec. 7.

"Villages that have not converted to gas may still use coal for heating, or other substitute fuels," the report quoted the country's environment ministry as saying.

The policy of banning industrial and domestic use of coal for heating has caused rationing of natural gas in some provinces and triggered a jump in prices, the report said.

State-owned China National Petroleum Corp. has warned of supply shortages if winter weather is particularly harsh, while other energy companies have taken the expensive step of renting additional gas storage facilities off the northern coast.

China's move to limit coal use is part of its efforts to meet environmental targets such as improving air quality amid the choking smog that has plagued the northern part of the country.

The port city of Tianjin has removed 10,000 coal-fired boilers in recent months, while the province of Hebei has removed 33,000 and has converted 149,000 homes to electric heating as of November 10, the report said, citing the Xinhua News Agency.