Abstract
Attempts to improve air quality in Beijing and other northern Chinese cities by switching home heating from coal to natural gas are having an unintended effect on the chemical industry. Unable to obtain gas needed to run some of their plants, BASF and other firms have had to temporarily shut them down. The problem is emerging as the weather has become colder in recent weeks. Natural gas is so scarce in the north that the government has ordered major energy companies to reroute gas meant for industrial users in the south. On Dec. 16, China’s powerful National Development & Reform Commission mandated provincial government and state-owned energy companies—including Sinopec, PetroChina, and China National Offshore Oil—to assist in supplying natural gas to cities and counties in the north. The order also allows some coal-fired power plants that were recently closed to resume production. In the chemical industry, the reallocation of gas
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