Steady power supply in Yunnan propels China Shenhuo to increase aluminium production

Henan Shenhuo Coal & Power Co Ltd declared this week that it is planning to amplify its production to achieve 900,000 tonnes which is the maximum capacity of the unit by the end of this month owing to the steady power supply in Yunnan province. Shenhuo is a renowned aluminium producer from China.

The power grid in Yunnan is yielding an ample amount of electricity to fully serve the aluminium smelters in the area after a soaring ratio of rainfall so far this spring; as reported by local news providers.

Coal is the most important catalyst in the aluminium smelting industry without which, the melting of alumina to produce aluminium wouldn’t have been possible. But the alternative to coal can be Hydro-power which is a sustainable source of energy with the least carbon footprint.

Yunnan province has always been a favourable location for installing aluminium smelting capacities, recently because of its enormous hydroelectric power supply. 

Various Chinese firms are relocating huge parts of their aluminium smelting units from the Northern Provinces like Shandong to Yunnan because the former primarily depends on coal for energy.

Shenhuo had plotted to relocate over half of its 1.7 million tonnes per annum aluminium production facility to Yunnan the previous year but a load-shedding in the area delayed the paradigm shift.

According to a new filing at the Shenzhen Stock Exchange, last year, Shenhuo had a utilisation rate of 41.67% of the total aluminium production capability of the plant.

As the filling confirmed, the company has restarted the shuttered capacity there along with expanding an additional aluminium smelting capacity of 150,000 tonnes per annum, that had already been constructed but not yet harnessed.

Shenhuo pocketed a profit of US$ 298.49 million last quarter which is three times the total collection of the quarter before that, concluded the filing documents.