East China Electricity Shortage Worsens

China's electrical power demands have increased, and the areas affected by blackouts will be larger than in 2003. The situation has become so serious that eastern China will have electrical power shortages the year round, instead of just in the summer.

While more electrical generation facilities will come online, more than 2/3 of the new capacity will come online in the second half of the year. Hydro electrical generation facilities are also suffering from a serious water shortage, which affect their electrical generation capacity.

The businesses which are affected most are in the Yangtze river delta region around Shanghai, and in the Pearl River delta region, which links Guangzhou and Hong Kong. Both areas have a strong presence of Taiwan enterprises and factories. Virtually all of them have been forced to change their work hours because of the electricity shortage, with blackouts for 1-2 days out of a week. Most factories have six-day work weeks.

Dongguan, in the Pearl River delta, is home to more than 5,000 Taiwan factories. In one village, the factories work for three days, but then have to close for one day because of the electricity shortage. In 2003, they had to shut down for two days out of every month.

Kunshan in the Yangtze river delta is home to a large number of Taiwan factories which are close to Shanghai. Most factories now have to put up with two days a week without electricity. Some factories have resorted to manufacturing at night to meet orders, even though this means that they have to pay their workers US$1 more per hour.

Because Shanghai is a major city, it gets preferential treatment when it comes to electricity allotment. However, factories in Shanghai are still affected, having to go without electricity for one day out of every two weeks.