Five major power generation groups turn their attention to new energy

On October 28th, CLP Power's sale of its shares in Zhangze Power was signaled to the same coal group. In recent days, the five major power companies have started to deal with their unfavorable thermal power assets through the use of equity transactions.

Following the CLP investment, the Huadian Group is also processing its assets recently and has just recently listed and transferred a 20% stake in Ningxia Datang International Dam Power Generation Co., Ltd. Dam power generation is currently the largest shareholder of Datang Power, holding 45% of the shares; Ningxia Power Generation Group and the Group held 35% and 20% respectively. On November 4th, Huaneng also listed 40% of its Yunnan Jidong Energy Co., Ltd. shares.

With such frequent transfer of thermal power business, it can be clearly seen that the huge gap between its severe thermal power business losses and the increase in coal price has already made the five major power generation groups feel unable to cope. In 2000, the average price of coal was only 227 yuan per ton. By the end of 2010, it had reached 799 yuan per ton. Also in 2000, the average price of one thousand kilowatt-hour electricity was 335 yuan, but it only rose to 410 yuan after ten years. In other words, the price of coal has increased 2.5 times in ten years, and the price of electricity has only increased by 0.22 times. With the deepening of the coal-electricity integration process, the five major powers have to start to choose and transfer coal power assets to coal companies to ease their negative profits over the years.

However, after coal and electricity co-operation, will the power generation companies that have thrown away thermal power packs be the future development and development direction? For power companies, the transfer of thermal power shares to get rid of loss-making business burdens undoubtedly paves the way for their cash flow and diversified development. . Recently, due to the loss of thermal power business, the five major power groups have started to invest more in new energy projects. Many of the investments have been concentrated in the renewable energy fields such as hydropower and wind power to offset the profits of the thermal power business. gap. According to CEC data, in the first three quarters of this year, the country’s infrastructure construction capacity increased by 49.62 million kilowatts, a decrease of 2.24 million kilowatts year-on-year. As of the end of September, the capacity of power generation equipment of 6000 kilowatts and above in China was 97.695 million kilowatts, an increase of 10.2% year-on-year; among them, thermal power increased by 8.8% year-on-year, and continued to be lower than thermal power generation and growth in electricity consumption of the entire society. In the first three quarters of the year, the nationwide thermal power started with a new scale of 12.62 million kilowatts. By the end of September, the scale of thermal power projects under construction was 67.55 million kilowatts, a year-on-year decrease of 13.38 million kilowatts and 17.85 million kilowatts respectively. In terms of clean energy, the proportion of total investment in hydropower, nuclear power, and wind power in the country’s power supply investment in the first three quarters increased by 5.8 percentage points from the same period of last year, and the proportion of investment in thermal power continued to decline.

According to statistics, in the first half of this year, Datang Group's investment was basically focused on wind power and hydropower projects, and it also involved in nuclear power and solar energy. Not long ago, the largest 50MV-class trough solar thermal power generation demonstration project built by Datang Group's new energy resources was located in the Small and Medium Enterprise Innovation Park in Balagon Town, Hangjinqi, Inner Mongolia. A total investment of 1.945 billion yuan, covers an area of ​​1.95 square kilometers, the annual power output of 165 million degrees, will be completed and put into operation in 2015. In addition, in the energy structure, several major power generation groups also have plans to increase the proportion of clean energy in the enterprise. Guodian Group, as the largest wind power developer in Asia, has a wind power installed capacity of 25% of the total installed capacity of wind power in the country, and its hydropower installed capacity is more than 10 million kilowatts. Clean energy accounts for less than one-third of the total assets of Guodian Group, but it effectively compensates for the huge losses. Guodian plans to increase the proportion of clean energy from the current 20.5% to 32% in 2015 and reach 40% by 2020. The CPI has announced that it will achieve the target of 50% of thermal power, 25% to 30% of hydropower, 10% to 15% of nuclear power, and 10% of renewable energy in 2020. In addition, Huadian’s goal is to achieve a 7.5:2:0.5 structural ratio of thermal power, hydropower, and new energy by 2013, and ultimately strive to reach 6:3:1 gradually. It can be seen that the strategic shift of the five major power generation groups in the new energy business is in full swing.

However, while the five major power companies have diversified their strategic layout to increase their profitability business, they still have to be wary of the lessons learned from the thermal power business in that year. They cannot blindly pursue the scale, blindly lead to asset idleness or underutilization. In order to avoid loosing the thermal power losses of the five major power groups, it further aggravated the company's debt ratio and financial costs.

In sum, the diversified investments of the five major power generation groups are themselves a double-edged sword, and they are a game between profits and liabilities. For the Big Five, it is obviously impossible to completely abandon all thermal power business at present. In the short-term, thermal power is still the largest proportion of the company's main business, and the government’s rationalization of the coal-fired power policy as soon as possible is still the fundamental solution to the five power companies’ current loss pressure. method.