Recent blog post and videos at CSIC have covered the labor shortage at factories along the coast in depth, but today let’s take a look at another shortage causing headaches for buyers- China’s power shortage.
The China Daily article Power-strapped China to see blackouts this summer explains:
Some parts of China will experience severe blackouts this summer as the result of an electricity shortage of 30 to 40 million kW.
Although power consumption is predicted to slow this year, growth momentum has remained steady and supplies are tight, according to a quarterly report released by the China Electricity Council (CEC).
“The shortage will hit about 30 million kW during summer peak days and may expand to 40 million kW if heat waves persist,” the CEC warned.
China’s more developed eastern and southern regions will bear the brunt of the shortages, followed by north and central China, while northeast and northwest China regions are expected to see an electricity surplus, the report said.
China has suffered seasonal power shortages in recent decades due to steadily climbing electricity use, breakneck economic growth and an unwillingness on the part of coal-fired plants to produce more energy amid rising costs and decreased prices.
What does this mean for us buyers?
It is generally the industrial areas that are hit with the brownouts and blackouts rather than the residential areas. This of course can have a big impact on production lead times.
The good news is that the power cuts are usually announced weeks or at least days in advance, and factories can schedule accordingly. For example, at my assembly center in Shenzhen, we have about 5 days each summer where power is cut off for a 12 hour period. But we have never missed a delivery date thanks to some strategic planning. Here are tips we use that you can apply to your suppliers as well.
1. Maintain open communications between factory and landlord/power bureau to ensure the factory gets notified of a power cut well in advance.
2. Build in some buffer time if possible.
3. Consider a diesel generator as back up. In our industrial park, the companies kicked in as a group and purchased one that is shared during the blackouts.
4. Many assembly functions don’t need power. As long as there is plenty of natural light during the day, hand tools can still be used. Get the power hungry tasks done in advance and save the labor intensive production for the days without power.
5. If the power is going to be cut on a Wednesday for example. Switch with Sunday and let Wednesday be the “weekend” when staff take a break.
6. During the summer it can get hot during the day, so it may be more comfortable to work in the evenings and mornings anyway. It is important to make sure staff approve and that your policy complies with local labor regulations, but factories can consider staggering the shifts around the times when power is out.
Let me know what strategies are working for you.
Wishing you successful China sourcing!
About the blogger
Written by Mike Bellamy – author of, “The Essential Reference Guide to China Sourcing” (chinasourcinginfo.org/book) and founder of PassageMaker Sourcing Solutions (www.PSSchina.com)