Utilities protest Chinese import ban

CHINA’S five top utilities have launched a formal complaint against a plan drafted to ban imports of low-grade coal.
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Staff Reporter

China Huaneng Group, China Datang Corp, China Huadian Group, China Guodian Corp and China Power Investment Corp have lodged a protest against the National Energy Administration’s proposal, according to Reuters.

"We've lodged a formal protest with the National Development and Reform Commission. We can't sit by and do nothing when we've been in the red for so long," a utility source said, declining to be identified due to the sensitivity of the matter.

The companies are only just returning to profitability after years of struggling against high coal prices.

The complaint argued the NEA's proposal, if adopted, would distort the market, raise coal prices and have little use in protecting the environment, the source said.

In the complaint the utilities said the import changes would force many coal traders to shut, eroding market competition and causing coal prices to rise, according to a second source.

The NEA’s planned import laws would ban thermal coal with a calorific value lower than 4500 kilocalories per kilogram, an ash content of more than 25% and a sulphur content of more than 1%.

Reuters reported the proposal also wanted to raise licensing requirements for Chinese coal traders, including having a minimum registered capital of 50 million yuan ($8.16 million) and having imported more than 1 million tonnes of coal in the last three years.

It is not clear when the proposal will be voted on or possibly implemented.

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