Industry status
Technology promotes wind power generation to enter the era of comprehensive parity, its cost still has great room for optimization, and the yield continues to improve; The investment in power transmission infrastructure is increasing, and the constraints on power transmission at the network end are eased in an orderly manner; With the acceleration of the process of power marketization and the increasing improvement of power information, the degree of energy storage participating in the market is deepening, and its cost recovery mechanism is continuously improved. Therefore, the regulation pressure generated by a high proportion of renewable energy power generation is gradually transferred from thermal power to its own distribution and storage regulation. We believe that with the gradual release of upstream capacity in 2022, the cost of photovoltaic wind power will further decline, and its installation scale and configured energy storage scale are expected to exceed expectations. We are optimistic about the investment opportunities of leading enterprises in photovoltaic and energy storage related industries.
Commentary
China’s installation volume in the first month exceeded expectations and is optimistic about the growth of China’s photovoltaic demand in 2022. The February renewable energy development and construction situation analysis meeting of the National Energy Administration pointed out that in January, the new installed capacity of wind power photovoltaic in China exceeded 12gw (exceeding market expectations). The bidding progress of ground power station components is ahead of schedule. According to our statistics, the bidding volume of components has reached 36gw since this year, compared with only 15gw in the same period last year, reflecting the strong demand of power enterprises for new energy development this year. We are optimistic about the basic situation in 2022. China’s demand will increase by 45% to 80gw at the same time.
Industrial and commercial electricity prices are market-oriented, and the yield of new energy power generation is better. Since July 2021, with the tense situation of power supply and demand, all localities have gradually abolished the regulation of “no upward floating” of market-oriented transaction price, and allowed the transaction price to float upward to 10% based on the benchmark price of coal. In October 2021, the national development and Reform Commission issued the notice on further deepening the market-oriented reform of on grid electricity price of coal-fired power generation, proposing to orderly liberalize the on grid electricity price of all coal-fired power generation, expand the fluctuation range of market transaction electricity price, orderly promote all industrial and commercial users to enter the power market, and cancel the catalogue sales electricity price of industry and commerce.
The proportion of fluctuating renewable energy power generation has increased, the system flexibility and resource demand have increased rapidly. According to the data of China electricity Union, by the end of 2021, the installed capacity of national scenery accounted for about 26.7% of the whole market, and the power generation accounted for about 11.7%, an increase of 2.7ppt/2.2ppt respectively over the same period in 2020 Among them, Inner Mongolia, Shandong, Shanxi, Xinjiang, Qinghai, Ningxia, Gansu and Northeast China all exceeded the national average. Up to now, the planned scale of energy storage projects in 2022 is more than 20gwh.
Valuation and recommendations
We are optimistic about the high growth of photovoltaic and electrochemical energy storage market. We recommend: 1) lithium battery and materials:
Recommend Eve Energy Co.Ltd(300014) , Yunnan Energy New Material Co.Ltd(002812) , Guangzhou Tinci Materials Technology Co.Ltd(002709) , Shenzhen Dynanonic Co.Ltd(300769) , Xingyuan shares, Shanghai Putailai New Energy Technology Co.Ltd(603659) , suggest attention: Guangzhou Great Power Energy&Technology Co.Ltd(300438) (not covered) and Pylon Technologies Co.Ltd(688063) (not covered); 2) Photovoltaic Faucet: Zhejiang Chint Electrics Co.Ltd(601877) , Trina Solar Co.Ltd(688599) , Ja Solar Technology Co.Ltd(002459) ; 3) Inverter: Sungrow Power Supply Co.Ltd(300274) , Ginlong Technologies Co.Ltd(300763) , Jiangsu Goodwe Power Supply Technology Co.Ltd(688390) ; 4) Thermal management: it is suggested to pay attention to: Shenzhen Envicool Technology Co.Ltd(002837) (uncovered), Shenzhen Cotran New Material Co.Ltd(300731) (uncovered).
Risk
The installed capacity of wind and solar power is less than expected, the promotion of power marketization is less than expected, and the promotion of energy storage policy is less than expected.
