Chinese villagers shiver in winter as gas subsidies phased out
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Gas meters are barely moving in most homes, even as temperatures fall below minus 10 deg C.
ST PHOTO: SIM CHI YIN
BEIJING – Villagers near China’s capital are facing a bitter winter, with many unable to afford gas heating after the phaseout of local subsidies intended to relieve the cost of Beijing’s campaign for cleaner air.
About two hours’ drive from Beijing, families in Hebei province are bundling up under quilts rather than switching on gas heaters, fearing they will not be able to pay the bills, Xinhua reported this week.
A villager surnamed Guo in Xingtai, in Hebei, told news outlet Yicai that using gas heaters could push his bill for this winter to at least 8,000 yuan (S$1,470), roughly one third of a farmer’s annual income in the region.
A blogger on Weibo posted a video showing gas meters in another part of the province barely moving in most homes, even as temperatures fell below minus 10 deg C.
The issue is not a lack of gas – in fact, supplies are relatively plentiful across the country, leading to a rare drop in imports in 2026.
The situation instead appears to be the result of a complex series of factors including price regulations, global energy shocks and strained local finances, all stemming from a push last decade to help clean some of the world’s most notoriously smoggy skies.
In 2017, the government ordered millions of rural homes in Beijing and surrounding areas to dismantle small coal furnaces and switch to cleaner heating sources, usually natural gas.
Gas is more expensive than coal, and local governments initially offered hefty subsidies to help cover the additional costs.
Those subsidies were always scheduled to shrink over time, shifting the burden from local governments to homeowners, according to a person familiar with the system, who asked not to be identified because the information is not public.
The reduction in subsidies ended up coinciding with a global energy shock in 2022, when Russia’s invasion of Ukraine led to soaring international gas prices.
The unexpected price shocks dragged Hebei province and local utilities into a combined 9.5 billion yuan loss in 2022 alone, pushing several local gas distributors to the brink of bankruptcy, the person said.
That forced Beijing to relax price controls, allowing suppliers to pass part of the higher costs on to residential customers.
The upshot is that in some areas in the province, gas costs rose from 2.78 yuan to 3.15 yuan per cubic metre, while subsidies fell from 1 yuan to 0.2 yuan per cubic metre, according to Yicai.
Meanwhile, in Beijing, where per capita GDP is more than three times higher than Hebei, officials gathered earlier this week to celebrate the success of the blue skies programme, as the level of airborne particulates fell to the lowest on record. BLOOMBERG
