Shanghai turns off the lights as China struggles to keep electricity supplies amid a record heatwave

China’s unprecedented 71-day heatwave has made it difficult for the nation to keep the lights on in recent weeks.

Stifling heat and drought have exacerbated a prolonged drought in China’s Sichuan region, which relies on 80% hydropower. As a result, the province, home to more than 80 million people, has been forced to close factories and urge residents to reduce their electricity consumption.

On Sunday, officials extended Sichuan’s power cuts through Aug. 25, and regions outside of Sichuan began their own cuts. The impact on supply chains and Chinese industry could be devastating due to its indiscriminate nature and factory managers’ inability to find workarounds.

“The situation has gotten worse in the last few days,” said Mirko Woitzik, global director of intelligence solutions at Everstream Analytics, a supply chain insights and risk analysis company wealth. “In terms of factory closures, last week was one of the worst weeks in China, with the overall situation approaching levels last seen during the severe COVID-19 lockdown in Shanghai/Kunshan earlier this year.

Limiting the amount of electricity that can be produced has disrupted more than a dozen automakers, affected lithium producers and slowed semiconductor processing at key plants, Woitzik said.

And in Shanghai, China’s financial center and largest city, officials said in a statement over the weekend that buildings along the Yangtze River would not be lit on Monday or Tuesday to conserve electricity, leaving the city’s world-famous skyline dark.

While power outages like these in factories and office buildings have a major impact on China’s economic growth and supply chains, there is another hidden bogeyman, according to Woitzik.

“If temperatures don’t drop in the coming days, transportation will also be affected — for example, across the Yangtze River, which has a similar importance in its supply chain as the Rhine in Europe, adding to manufacturing supply chain problems,” he said.

Recently, the low water level in the Rhine prevented cargo ships from completing their shipments, affecting supply chains in Europe. Deutsche Bank even called the river a potential “Achilles heel” for the bloc as it continues to battle an ongoing energy crisis. If China’s drought doesn’t end soon, the country could face a similar situation.

China’s heatwave has also spread geographically: nearly 530,000 square miles inside the country have had temperatures above 40°C (104°F) at least once in the past 70 days, according to state media reports. It’s so bad now that more than 260 Chinese weather stations have recorded their highest-ever temperature readings over the past two months.

“I can’t think of anything quite like China’s summer 2022 heatwave in its mix of intensity, duration, geographic extent and number of people affected,” meteorologist Bob Henson told Axios.

Woitzik pointed out that the Hunan region, east of Sichuan, was also forced to declare a state of emergency due to the heat wave and drought. The province gets about 40% of its electricity needs from hydroelectric power, and with falling water levels in the reservoirs, the region is introducing power outages, as Sichuan has been doing, to conserve energy.

China’s largest freshwater lake in the Hunan region has shrunk by 66% due to drought and extreme heat, which is revealing frightening pictures for aircraft passengers flying over the area.

That’s not good news because Hunan produces 22% of China’s rice, which is the staple food of 65% of the country’s population, according to researchers at Hunan Agricultural University; The province is also known as a manufacturing center for special machinery and metals.

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