China’s Utility Giants Vulnerable to Water Scarcity, Report Says

China’s five largest power utilities, which depend on water-intensive, coal-fired stations to generate electricity, are vulnerable to water supply disruptions because they are centered in the country’s water-scarce northern regions, a new report says. According to Bloomberg New Energy Finance, the five power generators — Huaneng, Datang, Huadian, Guodian, and China Power Investment — operate hundreds of gigawatts of thermal plants in the industrial northeast, where water resources are increasingly strained. Eighty-five percent of China’s power-generating capacity is in water scarce regions, said Maxime Serrano Bardisa, one of the report’s coauthors. The report said that major technical and policy shifts will be required to avert serious disruptions, including the addition of systems that use less water, such as closed-cycle or air-cooled systems. Such improvements could cost the utilities $20 billion in retrofit costs, the report said.