The conspiracy theories behind China's power cuts

Last year, Western media attributed the cause of China's power shortages to the latter's unofficial ban on Australian coal. This year, Chinese netizens and we-media are claiming that power cuts are necessary and a result of “an invisible exchange of swordplay in big country economic competition”. Leveraging nationalism and big power competition to garner attention and support is indeed the order of the day. Zaobao journalist Liu Liu explains why Chinese authorities and state media are debunking these conspiracy theories and refusing to ride on the patriotism wave.
People walk past a China Energy coal-fired power plant in Shenyang, Liaoning province, China, 29 September 2021. (Tingshu Wang/Reuters)
People walk past a China Energy coal-fired power plant in Shenyang, Liaoning province, China, 29 September 2021. (Tingshu Wang/Reuters)

The power cuts in several provinces in China have become a hot topic over the past week, not just because of the huge impact on people’s lives, but also because of the “big chess theory” (大棋论, meaning grand strategy) that has sprung up to explain the power cuts.

Apparently, an “internet celebrity economist” on we-media described the current power rationing as a “big chess match that China is playing”, and that behind it is “a huge international price-setting war”. Subsequently, major we-media outlets also built up an atmosphere of a “financial war against the US”, declaring that this is “an invisible exchange of swordplay in big country economic competition”.

However, on the night of 28 September, the CCTV website released a commentary saying that the so-called big chess theory hides the basic fact that there is a shortage of coal supply, and levelled the criticism that “amid the chaos, these misleading views have generated a lot of low-level mistakes and high-level embarrassments (低级红, 高级黑).”

Why is there attention on the current power rationing?

At the end of last year, China went through a power shortage, with power rationing and power cuts in Zhejiang, Hunan, and Jiangxi. Yiwu and Jinhua in Zhejiang called on administrative departments and public venues to reduce or not use heating facilities, while factories also received notifications of power cuts. Hunan and Jiangxi also released notifications calling on people not to use high-power equipment, and that power cuts could be implemented during peak periods.

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A vendor cooks barbecues at the entrance of an industrial park in Houjie, in Dongguan China's southern Guangdong province on 30 September 2021, an area hit by power restrictions. (Noel Celis/AFP)

However, unlike last year when electricity use was mainly limited in the industrial realm, this year’s power shortage has affected residents of some areas, and daily life has been disrupted without warning.

This has led to some surreal images: blocked up roads in some cities because traffic lights are not working; a pregnant woman climbing up 20 stories because the lifts are out of power; city pumps at a standstill; stores doing business by candlelight; a family of three becoming victim to carbon monoxide poisoning because they burned coal for warmth and their exhaust fan was not working; even hospitals were subject to power rationing.

But even before the impact of power cuts on people’s daily lives eased, social media was flooded with the big chess theory. Some of these articles said the power rationing was a strategy aimed at “Western speaking rights and price-setting rights”, a strong suppression of exporting domestic products to resist the US’s export of inflation; other articles gained attention by linking it to the return of Huawei CFO Meng Wanzhou and the US-Australia submarine deal.

...the little folk will just have to put up with small things like not being able to take the lift and having to light candles, because sweating the small stuff will ruin the big picture (小不忍则乱大谋). - Chinese social media

One article advocated: “This is a face-off between countries, it just depends on who can stick with it to the end. Since it cannot be avoided, let’s fight back as well as we can! Since we choose to stick around, we have to stick around to the end. There is no other choice.”

What that means is that in this “big country competition”, the interests of the few have to be sacrificed — the little folk will just have to put up with small things like not being able to take the lift and having to light candles, because sweating the small stuff will ruin the big picture (小不忍则乱大谋).

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Residents in Heilongjiang having a meal by candlelight. (Internet/SPH)

Why do the authorities dislike the big chess theory?

The CCTV article “There Are Not That Many ‘Big Chess’ Pieces in the Power Cuts” pointed out that the power rationing was mainly due to factors like the nationwide coal shortage, the cost of coal being seriously mismatched with basic electricity prices, and reduced power line capacity.

The article added that there has been a significant shrinking of China’s production of thermal coal and coke. Coupled with lower coal imports and a low volume of coal coming in from Mongolia, there is a clear shortage in the supply of coal electricity, which obviously does not fit China’s high demand for electricity as led by its economic recovery.

The views of industry players are generally similar to those in the articles. They feel that the main reason for the current power rationing is an imbalance of demand and supply. Energy expert and economist Dr Liu Manping said the main reason is that China’s supply-side reforms and lower coal exports from Australia, Mongolia, and Indonesia have led to insufficient coal supply and rising coal prices in China, resulting in an electricity shortage.

Other unique situations include: hydropower is not working well, and wind and solar power cannot take on the supply load; end-user electricity prices have not been adjusted, and electric companies are losing money with every kilowatt they generate, so that they are not motivated; some areas have seen a too-rapid increase in high-energy, high emission projects, leading to a jump in electricity use among secondary industries; some areas have a high-temperature climate; some areas used up their energy quota too quickly, and had to implement across-the-board power cuts in order to meet their criteria.

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The sun sets behind electricity power pylons in Beijing on 28 September 2021. (Leo Ramirez/AFP)

China’s National Development and Reform Commission and the Central Commission for Discipline Inspection released statements on 29 September, emphasising that coal shipment would be further bolstered and prioritised so as to avoid power cuts as much as possible. These statements indirectly refute the big chess theory.

Such a theory paints local governments’ incompetence and penchant for quick wins as necessary trade-offs for the good of the nation. This not only leaves their shortcomings undiscovered, but it also embellishes their performance.

Patriotic consumerism easiest route to take

Why is Chinese state media unsupportive of the big chess theory that fits hand in glove with surging nationalism in China? Perhaps it is just like what the CCTV article has reported, that the big chess theory deviates from basic facts. But more importantly, it covers up the shortcomings of local governments.

Such a theory paints local governments’ incompetence and penchant for quick wins as necessary trade-offs for the good of the nation. This not only leaves their shortcomings undiscovered, but it also embellishes their performance.

The CCTV article also pointed out that the rushed power restriction policies that some local governments have imposed are due to their lack of regard for the pace of industrial upgrading, their mismanagement of energy usage and consumption, and their inability to breakthrough “campaign-style” carbon reduction measures.

At the same time, the so-called big chess theory deviates from basic facts because it creates the impression of “cutting electricity for the sake of limiting production” and the misperception that the “power crisis is merely a result of man-made calculated restrictions”.

This picture shows a building of an industrial park in Houjie, in Dongguan, Guangdong province, China, on 30 September 2021, an area hit by power restrictions. (Noel Celis/AFP)
This picture shows a building of an industrial park in Houjie, in Dongguan, Guangdong province, China, on 30 September 2021, an area hit by power restrictions. (Noel Celis/AFP)

Similarly, the public account Xiakedao (侠客岛) under People’s Daily published an article on 26 September addressing China’s “dual control” goal of keeping down the country’s energy intensity and consumption. It said that the “all-purpose remedy” of shutting down production or restricting residents’ electricity usage just to optimise energy consumption indicators was merely aimed at achieving the dual control goal of campaign-style carbon reduction.

The article candidly pointed to the local governments’ behaviour of not taking action consistently and waiting until assessment time to get cracking. The article likened this to students who only did their homework when school was about to reopen and questioned: “The red light was already flashing but they waited until they were about to cross the line before hitting the brakes. Have they ever considered the feelings of the passengers?”

However, it is not that the we-media who proposed the big chess theory are blind to the real problems exposed by this round of power restrictions — they have framed the scenario as great power competition perhaps because this would garner more views. After all, riding on the patriotism wave is an easy business.

Western media: constructing another big chess theory?

Aside from the Chinese themselves, Westerners have in recent years been paying close attention to China’s power crisis. Western media has become particularly sensitive to the issue in relation to China’s ban on Australian coal imports amid escalating tension in China-Australia relations. Conspiracy theories much like the big chess theory have been bandied about.

Travelers gather in the square outside Shanghai Railway Station in Shanghai, China, on 29 September 2021. (Qilai Shen/Bloomberg)
Travellers gather in the square outside Shanghai Railway Station in Shanghai, China, on 29 September 2021. (Qilai Shen/Bloomberg)

When China experienced power shortages late last year, ABC (Australian Broadcasting Corporation)’s Chinese website quoted global investment management company AMP Capital’s chief economist Shane Oliver saying, “The disruption to the supply of coal into China as a result of the bans on Australia may also be playing a role in that and causing rationing.”

At that time, Radio France Internationale reported that China’s ban has not only harmed the Australian coal industry but the Chinese people and enterprises in some parts of China who are forced to put up with intermittent power outages and higher heating costs in the harsh winter.

Voice of America Chinese even described China’s manner of cutting power in winter to retaliate against Australian coal as “killing a thousand of its enemies but losing 800 of its own soldiers” (杀敌一千自损八百), that is, bringing disaster to its own people and enterprises through its tactics.

...compared with China’s total coal consumption, Australian coal imports do not make up a big proportion of this figure and can hardly account for China’s power outages. But some Western media consider hyping this up as a weapon against China.

Anglers fish along the Huangpu river across the Wujing Coal-Electricity Power Station in Shanghai, China, on 28 September 2021. (Hector Retamal/AFP)
Anglers fish along the Huangpu river across the Wujing Coal-Electricity Power Station in Shanghai, China, on 28 September 2021. (Hector Retamal/AFP)

While the ban on Australian coal has certainly affected China’s coal supply, official statistics show that coal imports from Australia, China’s second-largest source of imported coal, stood at 55.88 million tonnes in the first half of 2020, and plunged to zero in the first half of 2021. But even so, 55.88 million tonnes of imported coal is only 3% of China’s total coal consumption of 1.85 billion tonnes during the same period. Even coal imports from Indonesia, China’s largest source of imported coal, which stood at 85.05 million tonnes in the first half of 2021, merely accounts for 4% of China’s total coal consumption. (NB: China produces most of the coal it needs. In 2020, it produced 3.84 billion tonnes of coal, its highest output since 2015 and growth of 90 million tonnes from the year before, according to figures from the National Bureau of Statistics. China has increased coal imports from Russia, Mongolia and Indonesia after Beijing implemented restrictions on coal imports from Australia. In 2020, it imported a total of 304 million tonnes of coal, a record high. However, China is also the world’s biggest coal consumer. According to Reuters, its overall consumption of the fossil fuel increased by 0.6% in 2020 from a year earlier to around 4.04 billion tonnes.)

In other words, compared with China’s total coal consumption, Australian coal imports do not make up a big proportion of this figure and can hardly account for China’s power outages. But some Western media consider hyping this up as a weapon against China. The reason is perhaps similar to China’s big chess theory.

Amid ongoing animosity between China and the West, China’s long-standing power and coal supply crisis, as well as its power cuts, have become yet another topic attracting widespread attention and shaping public opinion trends. Under such circumstances, rational, neutral and objective voices may become increasingly rare.

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