This Wall Street Journal article explains the new threat of greater regulation on natural gas companies operating in their country. The regulations have started in Hebei and may spread throughout the rest of the nation, or elsewhere. The switch to natural gas is one that the Chinese government has been attempting to achieve with as little problems as possible. The article states that Beijing wants to increase its now 4% use of natural gas to 10% by 2020. Natural gas companies, such as ENN Energy Holdings Ltd. and China Resource Gas Group Ltd., are seeing increases in their stocks, up 74% and 53% respectively. Part of the increasing wealth in the natural gas market is the increased use of natural gas, but it is also partially due to the higher prices the companies are using. These higher gas prices are inhibiting the nation’s switch to natural gas, as they want consumers to be able to purchase natural gas in their own homes and social stability.
China’s eagerness to switch over to natural gas has been initiated partially due to the fact that they now hold the title as the world’s biggest user of energy. They want to decrease pollution, improve efficiency, and most likely prove to be more innovative than other nations. Should other nations pay attention to how the Chinese government is using regulation in order to make a switch of energy? It is an interesting approach, instead of simply demanding or encouraging natural gas use, they just make it more appealing to consumers by keeping a check on the pricing. The switch to natural gas energy could easily sweep the globe, and it will be important to notice how countries are accomplishing this task. While these regulations may hurt the natural gas energy companies right now, the benefit of encouraging a switch to natural gas will help them overall.
http://online.wsj.com/article/SB10001424052748703713504575476740661162412.html?mod=WSJ_Energy_leftHeadlines
- Caitlin McGonnigal
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