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China orders closing of wasteful factories

Associated Press / August 10, 2010

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BEIJING — China has ordered 2,087 steel mills, cement mills, and other factories with poor energy efficiency to close as the country struggles to cut waste and improve its battered environment.

The “backward’’ facilities produce steel, coke, aluminum, paper, and other materials throughout China and must close by late September, the Ministry of Industry and Information Technology announced Sunday.

Authorities said last week that a five-year plan to improve energy efficiency suffered a setback this year as China’s economic rebound and a construction boom boosted demand for steel, cement, and other energy-intensive products.

The plan calls for a 20 percent reduction in energy consumption per unit of economic output, or energy intensity, by the end of this year. The government said in March it had cut energy intensity 14.4 percent by the end of 2009 but said last week that energy intensity crept up 0.09 percent in the first half of this year.

China overtook the United States last year as the world’s biggest energy consumer, though with a larger population it still is well behind in consumption per person, according to the International Energy Agency.

China’s surging energy demands have alarmed its leaders, who worry about dependence on imported oil and gas from volatile regions such as the Persian Gulf and pollution damage to scarce water supplies and forests.

The country’s growing presence in international energy markets has prompted complaints that it is pushing up crude prices and making supply deals with international pariahs such as Iran and Sudan.

China is the world’s biggest steel producer and a major producer of other industrial materials as well. Its newest facilities are equipped with the latest technology but there are thousands of small, outdated paper mills that local authorities are reluctant to close for the sake of jobs and tax revenue.

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