Key investment points:
Market review: this week, the public utility index fell 0.48%, the environmental protection index fell 4.77%, and the Shanghai Composite Index fell 3.87%. Among the environmental protection sectors, the atmospheric treatment and testing service sectors fell significantly, down 8.77% and 5.85% respectively. Among the utilities, thermal power increased the most, up 1.44%; Integrated power services fell the most, down 2.50%.
Industry trends:
Environmental protection:
1) implement energy conservation, improve energy efficiency and promote green development of emission reduction and carbon reduction. Recently, the national energy conservation center issued the action plan for energy conservation and efficiency enhancement and green carbon reduction services. The plan proposes to focus on cities under great pressure to reduce energy consumption and improve energy efficiency, focus on key areas of energy consumption, provide comprehensive services, strive to promote local governments to better implement various measures for energy conservation and carbon reduction, complete the objectives and tasks of energy consumption control in the 14th five year plan, and promote green and high-quality development in the region; Focusing on the green transformation of local industrial parks, promote industrial parks to achieve greater results in overall energy conservation and carbon reduction, energy system optimization and cascade utilization, and green upgrading; Focus on local key energy consuming industries and key energy consuming units, fully tap the potential of energy conservation and efficiency, emission reduction and carbon reduction, take stronger measures to continuously improve energy efficiency, and promote the green level of industries and key energy consuming units; Strive to promote the extension and expansion of energy-saving services from single and short-term technical services to integrated and systematic comprehensive services, explore and innovate replicable and popularized market-oriented service modes, strive to build service actions into sustainable and mechanism guaranteed brand services, and promote the in-depth development of energy-saving service industry. It is suggested to pay attention to: the leader of cold chain compressor, actively layout [ Moon Environment Technology Co.Ltd(000811) ] which brings new momentum of performance growth to CCUs and hydrogen energy industry.
2) all localities issued improvement plans for rural residential environment and paid attention to rural environmental governance. Recently, Fujian Province and Hebei Province issued a five-year action plan for the improvement of rural living environment. The implementation plan for the improvement of rural living environment in Fujian Province proposes that by 2025, rural sanitary toilets will be fully popularized, and toilet feces will be effectively treated or recycled; The treatment rate of rural domestic sewage has reached more than 65%, and a large area of rural black and smelly water has been basically eliminated; The harmless treatment of rural domestic waste has been basically realized, and the ecological treatment mechanism of rural organic waste has been basically established; 5000 kilometers of newly built and reconstructed rural roads; The penetration rate of tap water in rural areas has reached more than 90%. The five-year action plan for the improvement of rural living environment in Hebei Province proposes that by 2025, rural sanitary toilets will be basically popularized and toilet feces will be effectively treated; The treatment rate of rural domestic sewage has been continuously improved, and disorderly dumping and discharge have been comprehensively controlled; Rural domestic waste is cleaned up every day, the level of harmless treatment is significantly improved, the incineration treatment is fully covered, and the villages with conditions are classified and reduced at the source; The appearance of the village has been significantly improved and the rural characteristics have been highlighted; The infrastructure of rural living environment is improved, and the public service system is more perfect. The governance level of rural residential environment has been significantly improved, and a long-term management and protection mechanism has been basically established. It is suggested to pay attention to: comprehensive water treatment service provider, zero emission faucet [ Bgt Group Co.Ltd(300774) ]; Ozone generator industry leader widely used in sewage and municipal water treatment [ Qingdao Guolin Environmental Technology Co.Ltd(300786) ]; [ Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) ] for coordinated development of water affairs and solid waste; [ Cscec Scimee Sci.&Tech.Co.Ltd(300425) ] committed to restoring the ecological environment of rivers and lakes.
Public:
1) give full play to the role of coal as the main energy and promote the emission reduction transformation of coal-fired power units. Premier Li Keqiang chaired an executive meeting of the State Council on April 20 to determine measures to ensure and increase energy supply and improve the guarantee capacity of energy for economic and social development. The meeting pointed out that we should be based on China’s national conditions, respond to external challenges, grasp key points, strengthen energy supply, and take precautions to promote the construction of energy projects with mature conditions and development needs. First, we should give full play to the role of coal as the main energy source. We will optimize approval policies for coal production and project construction, implement local responsibilities for stabilizing production and ensuring supply, and fully release advanced production capacity. Through nuclear capacity increase and new production, 300 million tons of new capacity will be added this year. Using market-oriented and legal methods to guide the operation of coal prices in a reasonable range. Second, we should promote the transformation of coal-fired power units and improve energy efficiency. The scale of transformation in the whole year exceeded 220 million kilowatts. Third, nuclear power should be developed in an orderly manner under the premise of strict supervision and ensuring absolute safety. The three new nuclear power unit projects that have been comprehensively evaluated and reviewed and incorporated into the national plan shall be approved. The policy measures proposed by the national standing committee are consistent with the previous policy direction. With the increasing efforts of coal price regulation and coal supply guarantee and increase policies, the coal price may gradually fall, and the certainty of thermal power profit restoration is expected to increase. Key recommendation: [ China National Nuclear Power Co.Ltd(601985) ] driven by nuclear power + wind solar dual core; It is suggested to pay attention to [ Huaneng Power International Inc(600011) ] [ Shanghai Electric Power Co.Ltd(600021) ] [China electric power] of thermal power to new energy.
2) actively promote the construction of new power system and pay attention to the construction of new energy storage projects. Recently, Anhui Provincial Energy Bureau released the new energy storage development plan (20222025) and widely solicited opinions. It is proposed in the plan that Anhui Province will realize the installed scale of new energy storage of more than 800MW by 2022, more than 1.5gw by 2023, more than 2.1gw by 2024, and more than 3gw by 2025. The 14th five year plan is a critical period to promote the transformation of clean and low-carbon energy. We pay attention to the investment opportunities brought by the application scenarios and business model applications of “new energy + energy storage” and new energy storage. It is suggested to pay attention to: the project reserves are sufficient, and the increment of photovoltaic and energy storage projects can be [ Jiangsu Linyang Energy Co.Ltd(601222) ].
Special topic of this week: offshore wind power is the key development field of China’s renewable energy, and the “14th five year plan” period will enter a new development period. During the “14th five year plan”, the scale of offshore wind power is expected to be significantly improved. Offshore wind power has the characteristics of high utilization of power generation hours, rich resources, suitable for large-scale development and no land occupation. It is the latest frontier of global wind power development. The 14th five year plan for modern energy system issued by the national development and Reform Commission and the national energy administration proposes to improve the clean and low-carbon development level of energy in the eastern region, actively promote the cluster development of offshore wind power in the southeast coastal areas, and focus on the construction of offshore wind power bases in Guangdong, Fujian, Zhejiang, Jiangsu and Shandong. In 2021, China’s installed capacity of offshore wind power jumped to the first in the world, forming a complete wind power industry chain and supply chain with leading level and global competitiveness. China’s offshore wind power has achieved a major breakthrough from slow development to leapfrog development.
Investment suggestions: during the 14th Five Year Plan period, the state has put forward more requirements for environmental quality and industrial green and low-carbon development. Energy conservation, environmental protection and resource recycling are expected to maintain a high outlook. It is suggested to actively grasp the investment opportunities in energy conservation, environmental protection and renewable resources. It is suggested to pay attention to: Moon Environment Technology Co.Ltd(000811) , Qingdao Guolin Environmental Technology Co.Ltd(300786) , Beijing Geoenviron Engineering & Technology Inc(603588) , Wangneng Environment Co.Ltd(002034) , China Tianying Inc(000035) , Hanwei Electronics Group Corporation(300007) . During the 14th Five Year Plan period, the low-carbon transformation of energy structure will continue to advance, the installed capacity of wind power and photovoltaic will still maintain rapid growth, hydropower and nuclear power will be promoted in an orderly manner, and energy storage, hydrogen energy and pumped storage will also enter a stage of rapid development. It is suggested to pay attention to: China National Nuclear Power Co.Ltd(601985) , Jiangsu Linyang Energy Co.Ltd(601222) , Shuifa Energas Gas Co.Ltd(603318) , Jiangxi Jovo Energy Co.Ltd(605090) , Huaneng Power International Inc(600011) , China Three Gorges Renewables (Group) Co.Ltd(600905) , Longyuan Power, Enn Natural Gas Co.Ltd(600803) .
Risk warning: the project progress is not as expected; Intensified market competition; Changes in the international political situation; Policy promotion is less than expected; Risk of price reduction.
