This week's topic
This week, we summarized and analyzed four questions from the aspects of renewable energy subsidies, profitability of thermal power business, power supply and demand, and installed capacity growth.
Core view
How about the profitability of thermal power in the second quarter?
With the fall of coal price and the rise of electricity price, we expect the thermal power business to improve in the second quarter. On the one hand, due to frequent policies, the coal price has dropped somewhat. In addition, the special verification of the signing and performance of medium and long-term coal contracts in 2022 is started, the performance rate of long-term coal is expected to increase, and the coal price into the furnace is expected to decrease. On the other hand, part of the cost can be channeled to the downstream under the background of multi place electricity price rising.
How to determine the full capacity grid connection time of renewable energy power generation projects?
The Ministry of finance has issued the notice on accelerating the review of the list of renewable energy power generation subsidy projects, which can be used to determine the time of full capacity grid connection. The identification method attached to the notice is mainly through ① the full capacity grid connection time promised by the renewable energy subsidy project, ② the grid connection time confirmed by the power business license, and ③ the grid connection time specified in the grid connection dispatching agreement. If you have different opinions, you can apply for review. If there is no problem with the materials required for review, the average utilization hours of 12 months after grid connection can be calculated from the full capacity grid connection time promised by the project enterprise. If it is not less than 50% of the annual average utilization hours of the same region, similar projects and the same period, it can be temporarily included in the subsidy list according to the full capacity grid connection time promised by the project.
How about the power supply and demand in 2022?
According to the previous analysis of China Power Council, China's power supply and demand will be generally balanced in 2022. During the peak summer and peak winter, the power supply and demand in some regions will be tight. In terms of power consumption in the first quarter, the national social power consumption was 2042.3 billion kwh, with a year-on-year increase of 5.0%. Among them, the national social power consumption in March was 694.4 billion kwh, with a year-on-year increase of 3.5%. In contrast, the growth rate of power consumption in the whole society in the first quarter of this year basically conforms to the previous forecast of China Power Union. From the growth rate of single March, the power consumption is greatly affected by the epidemic, which is significantly lower than the quarterly growth rate.
How to see the growth of centralized photovoltaic and distributed photovoltaic installation?
At present, the price of components is still at a high level. According to pvinfolink, the centralized project of single glass large-size components is about 1.85-1.87 yuan per watt, and the price of distributed projects is about 1.9-1.93 yuan per watt. Based on the price of components, the sensitivity of distributed PV and centralized PV to the price of components, we expect that the proportion of distributed PV in the new PV installation this year will remain high.
Investment suggestions:
The rising trend of electricity price continues in 2022, with the superposition of coal price decline, and the profitability of thermal power business is expected to improve in the second quarter. If the shortage of renewable energy is solved, it will effectively alleviate the pressure on accounts receivable of relevant companies, its cash flow and asset liability ratio are expected to be significantly improved, and industry confidence is expected to be enhanced. In the long run, it is conducive to the sustainable and healthy development of renewable energy power generation industry. Distributed photovoltaic is continuously promoted by the dual carbon target in the medium and long term. In the short term, it is catalyzed by the promotion policy of the whole county, which is expected to maintain a high growth rate. In terms of specific targets, the proposal of thermal power transformation into new energy targets focuses on [ Huaneng Power International Inc(600011) (a + H)] [China Resources Power] [ Huadian Power International Corporation Limited(600027) (a + H)]. New energy operators suggest paying attention to [Longyuan Power] [ China Three Gorges Renewables (Group) Co.Ltd(600905) ].
Risk tips: the policy promotion is less than expected, the power demand is less than expected, the risk of electricity price reduction, the risk of coal price fluctuation, the epidemic rebound than expected, etc
