How the Lights Went Off in China’s Hydropower Capital

The southwestern province of Sichuan’s massive hydropower industry powers homes and businesses as far away as Shanghai. But even renewables aren’t immune to the challenges of climate change.

No country on earth produces more hydropower than China, and nowhere in China is the hydropower industry more concentrated, more developed, or more important than the southwestern province of Sichuan. Owing to its abundance of water resources and the steep downhill flow of its waterways as they descend from the Qinghai-Tibet Plateau, Sichuan has the highest hydropower output of any Chinese province. Its dams not only serve local consumers, but also homes and businesses across central and eastern China. Hydropower from Sichuan accounts for as much as 34% of Shanghai’s power supply at peak hours, for example.

Historically, summer is peak hydropower season in Sichuan, as rains swell rivers and reservoirs across the province. But this year, summer brought a historic combination of drought and heat, one that not only strained local power resources, but those of the country’s manufacturing and industrial heartland. For the first time ever, the Sichuan provincial government activated the highest level of its power shortage emergency response plan, calling on roughly 4,000 companies to reduce production and avoid energy use during peak hours to ensure a stable supply for residential consumers. Despite these extreme measures, residents in several parts of the province reported scattered outages as temperatures soared over 40 degrees Celsius.

The challenges Sichuan faced this summer are perhaps only a taste of what’s to come, as climate change threatens power networks and other key infrastructure across China. Over the last decade, Sichuan’s hydropower capacity has expanded rapidly. But even renewable energy is not immune to the effects of climate change, and now China’s hydropower heartland must prepare for the possibility of shortfalls even in the summer — shortfalls that could spell big problems for residents and businesses across China.

As of late 2021, Sichuan had almost 90 gigawatts of hydropower capacity installed, nearly double what it needs to provide for local users. The surplus is not as big as it seems at first, as much of this capacity is contracted to buyers across China. Nevertheless, because the construction of intra- and interprovincial transmission lines has lagged behind new power generation projects, a not insignificant amount of the province’s hydropower capacity goes to waste each year, as producers curtail excess production they cannot sell.

In 2017, Sichuan’s hydropower curtailment reached a record 55 terawatt hours (TWh). That’s equivalent of the entire annual power consumption of the major central city of Wuhan. In 2020, the province’s main river basin lost another 20 TWh of hydropower production to curtailment. This excess power represents not only a tremendous waste of clean energy, but also significant unrealized economic potential.

This summer, however, drought and heat dropped the effective hydropower generation capacity of the province to between 23 and 25 gigawatts — less than half of what is needed to meet local demand. In the first half of August, rainfall in Sichuan was 60% lower than the previous year. That hurt almost all producers, but particularly the many smaller, reservoir-less hydropower stations that dot the province. At its worst point, Sichuan’s overall power generation shortfall reached 17 gigawatts.

The problem wasn’t just low power output and drained reservoirs; as temperatures spiked, residents tried to stay cool with fans and air conditioners. Rough estimates based on public statistics suggest Sichuan’s peak power load this year spiked to 65 gigawatts, an increase of 25% from 2021. Cooling equipment may have accounted for anywhere between 60% and 70% of this jump.

Given the circumstances, there weren’t many viable emergency response measures at the administrators’ disposal. Because Sichuan is one of China’s key clean energy producing provinces, the country’s power grid is not designed to supply it with power from elsewhere in the event of a shortfall.

To alleviate this year’s crunch, the Debao high-voltage direct-current line from Baoji in coal-rich Shaanxi to Deyang in Sichuan was kept operating at maximum capacity. Combined with additional lines leading from China’s southern power grid as well as the provinces of Gansu and Hubei, grid officials were able to provide Sichuan an additional 4 gigawatts. But the newer ultra-high voltage transmission lines between Sichuan and eastern China are only set up to send power, not receive it.

Thermal power and other renewable energy sources are not viable alternatives, either. In a typical summer, when hydropower is at its peak, some thermal power units are switched off to undergo repairs. In addition, poor coal quality, the need for cooling water, and challenges operating the plants during heat waves or drought conditions make it clear that thermal power won’t be able to pick up the slack. When hydropower output dropped this year, the province’s 18.5 gigawatts of thermal power units was able to generate just 12 gigawatts.

The pace of development of non-hydro renewable power sources in the province also remains slow. On paper, there are only 7 gigawatts of wind and solar generation capacity in Sichuan; in practice, the maximum output of these installations may be closer to 3 gigawatts at best — a drop in the bucket compared to a shortage like this year’s.

Looking across the globe, the power outages in Texas during the winter of 2020, the heat wave that caused an energy crisis throughout Europe this year, and the recent power shortage in Sichuan were all related to extreme weather events. And as Sichuan’s power woes show, even power systems reliant on relatively stable renewable energy sources like hydropower are not immune to the unpredictability of climate change.

Looking ahead, in addition to a planned 10 gigawatts of new hydropower capacity, more solar installations are needed to accelerate the transition to sustainable power systems in the region. To ensure resource adequacy during extreme weather conditions like what we saw this summer, natural gas may be another option worth exploring.

Furthermore, steps need to be taken to maintain supply-demand balance. To date, China has focused on increasing generation to meet demand, but with supplies increasingly climate-sensitive, consumers must be incentivized to save power where possible.

Increasing the flexibility of energy supplies and bolstering the links between regional power grids is also vital. Establishing a flexible, interregional energy market could make it easier for provinces to provide each other with more prompt, effective, and far-reaching assistance in times of need. Indeed, both Sichuan’s long-term surplus problem and this year’s severe shortage arose from the same cause: the excessive rigidity of China’s power trading mechanism, which makes adjusting transmission agreements in emergencies more difficult. Rebalancing the national power supply through market mechanisms might help alleviate some of these challenges in the future.