2021 is the first year of Green Power Investment: the green power sector performed well in 2021, and the annual public utility index increased by 29.48%, among which the performance of new energy power generation sector was outstanding. The growth of wind power generation and photovoltaic power generation in 2021 was 80.6% and 32.02% respectively, and the annual growth of thermal power sector was 39.3%.
Green power has ushered in the golden age of “rising volume and price”: 1) the scenery industry chain is maturing, the era of parity is coming, and the green power industry has ushered in the peak of production under the dual role of industrial trend and policy promotion by superimposing the “double carbon” target policy stimulus; 2) Under the power market reform, the thermal power price rises, which brings the space for the market-oriented price discount of wind and solar energy stock projects to narrow. At the same time, the green power transaction is officially opened in 2021, which brings a high premium for affordable wind and solar energy projects. Under the background of “double carbon”, we continue to be optimistic about the investment opportunities of green power sector in 2022. We put forward the investment framework of green power operators: 1) evaluate the quality of green power operators from three aspects: enterprise scale, enterprise profitability and capital strength; 2) From the three aspects of “project planning”, “project competitive allocation” and “projects under construction”, this paper analyzes the growth and certainty of the future long, medium and short-term performance of green power operators, and selects green power bids with both long-term investment value and strong short-term performance cashing ability.
Based on the current situation, how to evaluate the quality of green power operators? We believe that the existing new energy installed capacity, project profitability and financial strength are important factors to evaluate the quality of green power operators. Firstly, enterprises with large installed capacity have strong first mover advantage; Secondly, the profitability of the project reflects the operating efficiency of the enterprise. The unit construction cost of the project, the proportion of on grid electricity price and market-oriented electricity, the resource endowment of the project location, the cost control ability of the enterprise, the operating life of the unit and the financing cost of project construction are the core elements affecting the profitability, We analyze the operating efficiency of each enterprise with kwh revenue / unit kW revenue and kwh net profit / unit kW net profit as indicators; In addition, the capital strength reflects the future project investment potential of the enterprise. We analyze the capital strength of each power enterprise from three aspects: the cash flow of the company’s operating activities, the level of asset liability ratio and financing cost. Through the above three aspects of analysis, large central power enterprises have certain advantages in capital strength and enterprise scale. At the same time, local state-owned enterprises with abundant resources have strong profitability and greater development potential.
Focusing on the future, how to judge the growth of green power operators? We start from three dimensions: long-term, medium-term and short-term
Analyze the performance growth and certainty of green power enterprises during the 14th Five Year Plan Period:
1) from the perspective of “project planning”, the long-term development potential of the enterprise: the installed capacity planning directly indicates the enterprise’s long-term strategy and willingness to develop in the new energy operation sector. In 2021, China’s “five major and four small” power generation groups successively issued the “14th five year plan”, According to rough calculation, as of the end of the 14th five year plan, the “five major and four small” power generation groups are expected to add more than 430gw of new energy installed capacity, with strong green power in the future. In addition, the project resource endowment and capital strength are also the core elements affecting the future long-term development of the enterprise.
2) looking at the medium-term growth rate of enterprises from the perspective of “project competition and distribution”: due to the relatively short construction cycle of wind power photovoltaic, we believe that the projects competing for distribution in 2021 are expected to start construction in 2022 and put into operation in 2023, which reflects the medium-term development potential of enterprises. From the situation of enterprises obtaining competitive allocation projects, the “five big and four small” power generation groups are absolutely competitive, and the top ten competitive allocation units are “five big and four small” power generation groups, China energy construction and China power construction.
3) from the perspective of “projects under construction”, the enterprise’s short-term performance is uncertain: the production cycle of Fengguang project is short, and the investment cash flow and the amount of “projects under construction” have a great impact on the short-term performance. The new energy project under construction in 2021h1 is expected to be put into operation at the end of last year and release the performance this year. We take “new energy installed capacity under construction” and “new energy projects under construction / total market value” as the core indicators of short-term performance elasticity evaluation to screen the targets with high performance certainty in the short term. Combined with the above three levels of analysis, we mainly recommend the target [ China National Nuclear Power Co.Ltd(601985) ] [ China Three Gorges Renewables (Group) Co.Ltd(600905) ] [ Huaneng Power International Inc(600011) ] [ Shanghai Electric Power Co.Ltd(600021) ] [ Cecep Wind-Power Corporation(601016) ] with high performance and certainty in the short and medium term
Risk warning: the installation and commissioning progress of new energy is less than expected; The increase of coal-fired electricity price is less than expected; The implementation of coal long-term association price is less than expected; Data deviation caused by incomplete statistics of Competitive Allocation projects
