Shandong's power plants lost 3.96 billion yuan in the first 10 months of 2010, up 271 percent year-on-year, China Business News reported Monday, citing information from the provincial economic and information technology committee.

Rising coal prices and the large withdrawals from circulating funds caused the huge losses, an official from the committee told the newspaper.

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From January to October 2010, the average price for standard coal that Shandong's top four power companies received reached 928.9 yuan per ton, 70.8 yuan or 8.2 percent higher than the 2008 level, the report said.

The power plants withdrew more than 8 billion yuan from circulating funds in the same period, the report said.

The recent thermal coal price hike has driven the price of standard coal up to more than 1,000 yuan a ton, said the official, adding that most of the power plants' financing chains are at risk.

The power plants in Shandong are receiving an obvious lower on-grid price than other provinces, said the committee.

The benchmark on-grid price for Shandong's power plants is 0.39 yuan a kilowatt-hour, 0.03-0.09 yuan lower than in the southern provinces, the report said.

In addition, the province will increase the volume of coal transported by sea to ease the coal supply strain, the committee said.