China is planning on shutting down more than 1,000 coal mines this year to counter a mammoth supply glut, the country's energy regulator said today.
The Asian superpower is the world's largest consumer of commodities, including coal, but demand has decreased in recent years due to the country's well-documented slowdown in economic growth.
China is also making efforts to move away from "dirty" fuels such as coal in order to tackle its major pollution problems. Two months ago, Beijing had to issue its first ever "red alert" - the country's highest air pollution warning - due to thick smog.
In a notice posted on its website on Monday, translated by Reuters, the National Energy Administration (NEA) said it plans to take 60 million tonnes of capacity offline this year. It added that the closures would form part of its plan announced earlier in the month to shut as much as 500 million tonnes of surplus production capacity within the next three to five years.
China is not approving any new coal projects for the next three years, in a bid to address its oversupply problem, which dragged down domestic coal prices by a third last year. China produced 3.7 million tonnes of coal in 2015 and has an estimated surplus of two billion tonnes per year.
The country is also planning to address overcapacity in the thermal power sector this year by banning new projects and shutting down existing ones.