This year, the power gap will reach 50 million kilowatts

The China Electricity Council (hereinafter referred to as “CEC”) recently released power data for 2011, indicating that thermal power investment has continued to decline rapidly, from 527.1 billion yuan in 2005 to 105.4 billion yuan in 2011. The annual loss of thermal power has caused power companies to lose the incentive and ability to invest in thermal power. Experts said that the rapid decline in thermal power investment may lead to inadequate thermal power installation in the next few years, resulting in “hard power shortages”.

The data shows that as of the end of last year, China's thermal power installed capacity reached 76.56 million kilowatts, accounting for 72.5% of the total installed capacity of 1.056 billion kilowatts. However, in 2011, thermal power installed only 58.86 million kilowatts, which is far below the level of 80 million kilowatts in previous years.

Xue Jing, director of the Statistical Department of China Telecom, told reporters that the main reason for the lack of growth in thermal power installations is that thermal power losses have caused power companies to lose investment momentum and capability.

Guodian Power, a subsidiary of Guodian Group, announced on the 17th that it had announced its “annual preannouncement of 2011 annual results,” saying that due to factors such as the production of new units and the sale of stock investment income, it is expected that 2011 net profit will increase by more than 50% year-on-year. However, the insider of the company told this newspaper that “The main reason for profitability in 2011 was not the thermal power business, but the result of the sale of stocks. The thermal power business of the company is currently only at break-even level.”

Huaneng Power, which was also affected by thermal power, announced that its major shareholder Huaneng Group has increased its holdings of Huaneng International’s 144 million shares on the block trading platform on the eve of the results announcement. This has led to the industry’s “majority shareholder blood transfusion” and paving the way for financing. Many guesses. According to reports, Huaneng Power currently has more than 60 million kilowatts of thermal power installed capacity, ranking first in the five largest listed companies for power generation.

At the same time, the changes in the profits of the five major power generation groups that were released in 2011 have further demonstrated the influence of the thermal power business. According to statistics, Huaneng Group had 6.1 billion yuan, Guodian Group had about 6 billion yuan, China Power Investment Group had 2.5 billion yuan, Huadian Group had about 2 billion yuan, and Datang Group had about 1.5 billion yuan; a total of 18.1 billion yuan. The profits of the above five household appliance enterprises in 2010 were: 6.98 billion yuan for Huaneng Group, 6.09 billion yuan for Guodian Group, 5.018 billion yuan for China Power Investment Group, 2.53 billion yuan for Huadian Group and 1.52 billion yuan for Datang Group; totaling 22.138 billion yuan. Therefore, the loss of the thermal power business resulted in the profit margin of the five major power generation enterprises for the two years mentioned above, which was RMB 4.038 billion.

For the above-mentioned power companies encountered due to thermal power business, Cao Peixi, general manager of Huaneng Group, also said recently that thermal power losses in recent years have reduced the financial status and profitability of power companies, resulting in a drop in thermal power investment for two consecutive years. It is expected that investment in 2012 will increase. New projects will continue to decrease.

As the main force of power generation, the growth rate of thermal power declined, which will undoubtedly affect the overall power supply situation. According to a report released recently by the State Council Development Research Center Enterprise Research Institute, China's electricity gap in 2011 is 30 million kilowatts. In 2012, the power gap will continue to expand, or it will reach 50 million kilowatts.

Xue Jing told the newspaper that as of the end of October 2011, the national thermal power construction scale was 64.18 million kilowatts, a decrease of 21.22 million kilowatts from the same period of last year; it is estimated that the newly installed capacity in 2012 will be reduced by 10 million kilowatts from 2011, which is in 2006. The least production year has been put into production.

"Because of the loss, many power companies have not started the road and have not started funding," said Xue Jing.

Xue Jing said that in the next few years, the new thermal power project will be mainly concentrated in the large coal bases in the Midwest, and the new project will be based on cogeneration and coal chemical and other comprehensive utilization of coal projects, thereby increasing coal utilization to reduce Loss of the project even turned losses.