The Influence Of “dual control of energy consumption” policy from the Chinese Government

Last year, the Chinese government has officially announced that China aims to reach peak emissions before 2030 and achieve carbon neutrality before 2060, which means that China only have 30 years for continuous and rapid emissions cuts. To build a community of common destiny, the Chinese people have to work hard and make unprecedented progress.

To commit the promise to the world that China will meet the emission peak in year 2030 and carbon neutrality in year 2060, The Chinese local governments have taken strict-ever actions to reduce release of CO2 and energy comsumption by restricted supply of electricity power.

In September, many local governments in China began to implement strict "dual control system of energy consumption" policies. Many manufacturer's production lines as well as upstream supply chain partners were all affected to a certain extent. In addition, the China Ministry of Ecology and Environment has issued the draft of "2021-2022 Autumn and Winter Action Plan for Air Pollution Management" in September. This autumn and winter (from October 1, 2021 to March 31, 2022), the production capacity in some industries may be further restricted.

Currently, some areas supply 5 days and stop 2 days in a week, some supply 3 and stop 4 days, some even just supply 2 days but stop 5 days.These actions will result in a terrible increase of all costs, from raw materials to packing materials, from labor cost to ports operation costs.

Due to the limited production capacity and the recent sharp increase in raw material prices, it will beforseen that the next round of price increasing from 15th October after Chinese National Holiday.