Capacity expansion of several industrial sectors may no longer be allowed in China’s Western Inner Mongolia in 2021

During the 14th Five-Year-Plan period, the Inner Mongolia Autonomous Region of West China is prepared to strictly limit the expansion of high energy-consuming industrial sectors, a decision that could significantly affect local chemical industries in Inner Mongolia.

Since 2021, the region will no longer approve capacity expansions in the coking, (semi-coke), calcium carbide, PVC, synthetic ammonia (urea), methanol, glycol, caustic soda, sodium carbonate, ammonium phosphate and yellow phosphorus industries, as well as polysilicon and monocrystalline silicon without derivative production activities. If capacity expansion is necessary, balance must be ensured between capacity and reducing energy consumption within the region. 

Except for a modern coal chemical project launched to extend and supplement the industry chain in line with national plans, no modern coal chemical project will be, in principle, approved during the 14th Five-Year-Plan period.

Meanwhile, regional guidelines will be provided for the orderly reduction of excessive capacity in restricted industry categories, which will be replaced by capacity upgrading and facility rebuilding. Industries that are included in the Phaseout Category of the National Industry Catalogue (2019 version) and industries that have not been running for more than one year in 2020 are not eligible for this capacity swap.

From 2021 to 2023, energy conservation-related technical upgrades must be carried out within high energy-consumptive industries, such as calcium carbide and chemical industries. All cities and counties are requested to completely upgrade at completion rates of 40%, 40% and 20% per year, respectively.