China's capital restores regular heating after natural gas squeeze
By Adam Rose BEIJING (Reuters) - China's capital Beijing restored regular heating on Tuesday after a temporary squeeze on natural gas supplies required public buildings to lower their thermostats, the commission of city administration and environment said on its microblog. The commission enacted emergency measures on Friday that ordered buildings to set room temperatures no higher than 14 degrees Celsius (57 degrees Fahrenheit) and cut off gas supplies to industrial users. The steps were taken after a liquefied natural gas (LNG) carrier had trouble unloading due to severe smog. The carrier unloaded 260,000 cubic meters of LNG on Sunday, according to a statement from China National Petroleum Corporation. CNPC also said gas demand should be restrained. It was unclear on Tuesday if supplies to industrial users had been restored. The main reason for the shortage in gas supplies is that prices - set by the government - are not adjusted when demand peaks, said Zhu Chen, managing director at consultancy SIA Energy. Regulators have been more concerned with boosting natural gas demand this year to alleviate its air quality problems by moving away from coal, than with supply shortages like the one that hit in late 2013. Gas prices were cut for a second time this year to non-residential users in late November. "This brief shortfall has something to do with the after-effects on the consumer market of the country's November price adjustment," Chen said. However, she cautioned that other factors played a role. "There's never just one reason behind an urgent shortage," she said, noting that air pollution, difficulties unloading LNG carriers during peak periods, and inadequate storage all played a part. This is not the first time authorities have limited supplies due to a shortage. During a demand surge in late 2013, supplies to industrial users were cut to ensure supplies for residential users. This year, gas supplies have been under increasing pressure as demand rises with winter, the country's economic planning commission said last Friday. Chinese natural gas demand growth fell to 3.7 percent in the first eleven months of the year, compared to 5.6 percent last year, and 12.9 percent in 2013, according to data from the planning commission. (Reporting By Adam Rose; Editing by Christian Schmollinger)
