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China Shows It’s Serious About Enforcing Coal Price Controls

  • Planning agency tells sellers to refund excessive payments
  • Beijing has pledged to avoid a repeat of crippling outages

China’s top planning agency has demonstrated its intent to keep coal prices in check, after a probe of deals struck by power plants found contracts that exceeded reasonable levels and sellers were told to refund excess payments. 

The National Development and Reform Commission’s close supervision of the price caps it imposed at the start of May is one of a number of measures to help generators ensure adequate electricity supply. But the agency’s dragnet also underscores the difficulty in relying on price controls just as the economy begins to recover from the stringent virus restrictions of recent months and demand for China’s mainstay fuel rises.