Events
The national development and Reform Commission issued the notice on further improving the coal market price formation mechanism to further improve the coal market price formation mechanism.
In order to implement the spirit of the central economic work conference and the executive meeting of the State Council, strengthen the regulation and supervision of coal market prices, guide coal prices to operate within a reasonable range, promote the coordinated development of upstream and downstream coal and electricity, and ensure the safe and stable supply of energy, the National Development and Reform Commission recently issued the notice on further improving the coal market price formation mechanism, Further improve the coal market price formation mechanism.
Brief comment
Guide the reasonable decline of coal prices, and the coal price center is expected to be lowered
The notice specifies three key measures. First of all, it should guide the coal price to operate within a reasonable range. The reasonable range of medium and long-term transaction price of 5500 kcal of underground coal in Qinhuangdao port is 570 ~ 770 yuan / ton, which is lower than the range of 550 ~ 850 yuan / ton in the previous exposure draft. At the same time, it also defines the reasonable range of medium and long-term transaction price in the mining link of Shanxi, Shaanxi and Inner Mongolia. We believe that due to the differences between thermal power and coal enterprises on the details of Changxie coal contract, the performance rate of Changxie coal was at a low level from January to February, and the fuel cost of thermal power still fluctuated during the rise of market coal price. At present, thermal power enterprises are in the situation of profit and loss balance or slight loss as a whole, but with the effective guarantee of the long-term coal cooperation mechanism, the center of thermal power profit is expected to be improved.
We will improve policies and mechanisms for energy conservation and emission reduction and strengthen the implementation of work
Secondly, the notice requires to improve the transmission mechanism of coal and electricity prices, guide the formation of coal and electricity prices mainly through medium and long-term transactions, and encourage thermal power to set coal and electricity linkage clauses in the long-term electricity cooperation contract. The third is to improve the coal price regulation mechanism. The national development and Reform Commission once again proposed that when the coal price exceeds a reasonable range, it should make full use of the means and measures stipulated in the price law and other laws and regulations to guide the return of coal price, which is consistent with the means by which the national development and Reform Commission intervened in the spot coal price through the price law when the coal price reached 2500 yuan in October 2021. The national development and Reform Commission also proposed to strengthen market supervision, prohibit improper intervention in the prices of coal and electricity operating within a reasonable range, strengthen the supervision of the performance of medium and long-term contracts of coal and electricity, strengthen the linkage supervision of the futures and spot market and antitrust supervision, and investigate and deal with price violations in a timely manner.
The NDRC press conference mentioned that although there is no reasonable range for the spot price of coal at present, the spot price cannot deviate significantly from the reasonable range of medium and long-term transaction price. It is necessary to effectively prevent the malicious speculation of speculative capital and prevent the sharp rise and fall of coal price. It is necessary to straighten out the price relationship between coal and electricity and promote the coordinated and high-quality development of upstream and downstream industries; It is conducive to giving full play to the role of coal as the basic energy to better ensure the safe and stable supply of energy; It is conducive to stabilizing the energy consumption cost of downstream enterprises and maintaining the stable operation of the economy.
We briefly summarize the contents of the policy. The core requirements of the notice include the following five points: 1. The coal price is formed by the market; 2. Guide the coal and electricity prices to be mainly formed through medium and long-term transactions; 3. The reasonable range of price is the industry consensus; 4. The coal and electricity price within the reasonable range can be fully transmitted; 5. If the price exceeds the reasonable range, it will be regulated and regulated in time.
At the current time point, from the perspective of supply and demand fundamentals and policies, we all believe that coal prices are expected to return to a reasonable range, and the profits of thermal power enterprises are expected to usher in deterministic improvement. Assuming that the performance rate of Changxie coal is 100% and the ceiling price of Changxie coal is 770 yuan / ton, the overall thermal power industry is expected to maintain a net profit of about 2-3 cents per kilowatt hour under the background of a significant increase in market-oriented electricity price, and the profitability will return to the historical median level. At the current time point, we are still optimistic about the power industry, which has both the value of thermal power hitting the bottom and the Growth Logic of rapid growth of new energy. The priority targets for thermal power to green power include Shanghai Electric Power Co.Ltd(600021) , Huaneng Power International Inc(600011) , Jilin Electric Power Co.Ltd(000875) and Fujian Funeng Co.Ltd(600483) ; We are optimistic about the robustness targets - China National Nuclear Power Co.Ltd(601985) , China Three Gorges Renewables (Group) Co.Ltd(600905) and Zhongmin Energy Co.Ltd(600163) . The relevant targets have been highly cost-effective after the callback.
Risk warning: policy promotion is not as expected; The downward range of coal price is less than expected; The installed capacity of new energy is less than expected; Electricity prices rose less than expected.
