(Yicai Global) Aug. 18 -- Sichuan's capital Chengdu and other areas of the southwestern Chinese province have begun to ration electricity as record high temperatures have led to drought, cutting hydropower generation in half.

Power rationing will be extended to three hours from two and a half hours a day, local generator Dazhou Electric Power Group announced yesterday.

Eighty percent of Sichuan's electricity comes from hydropower plants, and high temperatures and drought have caused a significant fall in river water, said Zhou Jian, deputy chief engineer at State Grid Sichuan Electric Power Regulation and Control Center. Some major plants have bottomed out, halving provincial hydropower capacity, he noted.

The heatwave that started last month has brought drought and a surge in power demand to keep cooling systems running. This summer, the province faces the most extreme heat, lowest rainfall, and heaviest power load in history, China Central Television reported yesterday.

Dazhou Electric's 110-kilovolt power grid covers seven counties in the city of Dazhou, with an installed hydropower capacity of 140,000 kilowatts. Its annual power supply reached 1.2 billion KWh, serving an area of 600 square meters with a population of 850,000.

Sichuan Guang'an AAA Public, another utility company, also issued a power outage statement yesterday, cutting electricity use by about 80,000 kW. Its shares [SHA: 600979] rose 0.8 percent today to close at CNY3.95 (58 US cents) each after slumping 6.9 percent yesterday.

“We’ve already stopped supply to industrial companies, and now it’s the turn of residents in Guang'an city and surrounding counties,” an employee at Guang'an AAA Public told Yicai Global.

The province's largest power supplier, State Grid Sichuan Electric Power, said earlier this week that to prioritize households only electricity to high energy-consuming firms would be rationed.

Power rationing generally targets businesses, an official at power producer in southern China told Yicai Global. But some local power companies are small with insufficient supply, so they have no choice but to also limit supply to households, the person added.

Editor: Futura Costaglione