The Zhitong Finance App learned that Changjiang Securities released a research report saying that as the thermal power base began to rise after March of last year, it is expected that the growth rate of thermal power generation will gradually decline in the future. The strong performance of thermal power is mainly due to: 1) rapid growth on the demand side; 2) the growth rate of thermal power generation decreased by 2.3% year on year in the same period last year, and the low base made year-on-year growth relatively easy to a certain extent; 3) the weak output of wind power and hydropower also provided some room for thermal power growth. The call for a “carbon neutrality” era and power market-based reforms will continue throughout the “14th Five-Year Plan” period, and the intrinsic value of power operators will be completely re-evaluated. The steady decline in coal prices brought about by the optimization of the supply and demand pattern is expected to catalyze marginal improvements in thermal power operations.

Recommended attention:

High-quality transformation thermal power Guodian Electric Power (600795.SH), China Resources Electric Power (00836), China Electric Power (02380), Huadian International (600027.SH), Huaneng International (600011.SH), Funeng Co., Ltd. (), and Yangtze River Delta coal power operators. 600483.SH

The hydropower sector recommends high-quality large hydropower Changjiang Electric Power (600900.SH), SDIC Power (600886.SH), and Huaneng Hydropower (600025.SH).

In the context of the triple bottom resonance of new energy sources, the industry is investing for a long time, recommending China Nuclear Power (601985.SH), Three Gorges Energy (600905.SH), and Longyuan Electric Power (001289.SZ).

The power grid sector recommended the Three Gorges Water Conservancy (600116.SH), a pioneer in electricity distribution and distribution, which is expected to develop integrated energy services after the Three Gorges Group enters the market.

Incident: The National Bureau of Statistics and the National Energy Administration released national electricity consumption data for January-February. In January-February, the total electricity consumption of the entire society was 15316 billion kilowatt-hours, an increase of 11.0% over the previous year; the power generation capacity of national statistical-caliber generator sets reached 1487 billion kilowatt-hours, an increase of 8.3% over the previous year.

The main views of Changjiang Securities are as follows:

Economic recovery and low base resonance have kept the country's electricity consumption growth rate high

In January-February, the value added of industries above the scale of China actually increased by 7.0% year on year, and the national economy recovered steadily. Furthermore, at the beginning of the year, China faced multiple rounds of cold weather. Driven by the effects of cold temperatures combined with the expansion of economic demand, in January-February, China's entire society's electricity consumption was 15316 billion kilowatt-hours, an increase of 11.0% year on year. In addition to the impact of demand expansion, the electricity consumption of the entire society increased by only 2.3% year on year during the same period last year. The low base also further boosted the growth rate of electricity consumption. However, the two-year compound growth rate of electricity consumption in the whole society still reached 6.6%, and the growth rate is still excellent.

From a segmented perspective, electricity consumption in the primary sector reached 19.2 billion kilowatt-hours in January-February, up 11.1% year on year; electricity consumption in the secondary sector reached 952 billion kilowatt-hours, up 9.7% year on year, indicating that industrial production continues to improve. The low base figure for the same period last year is also the reason why the electricity consumption growth rate remained high. In January-February, the electricity consumption of China's tertiary sector was 286.9 billion kilowatt-hours, up 15.7% year on year. The cumulative total for 6 consecutive months was over 10% year on year.

In addition, the electricity consumption of urban and rural residents in January-February was 273.5 billion kilowatt-hours, an increase of 10.5% over the previous year, mainly due to the low base for the same period last year. Based on the electricity consumption in January-February of this year and the year-on-year growth rate of electricity consumption in January-February of last year, the impact of electricity consumption in January-February was 1.27%, 55.74%, 25.78%, and 17.21% of the electricity consumption of urban and rural residents in January-February, respectively.

Thermal power output continues to increase, and clean energy is under slight pressure

Under the combined influence of the electricity demand of the whole society, which continued to grow rapidly and the low base for the same period last year, in January-February, the power generation capacity of units above scale was 1487 billion kilowatt-hours, an increase of 8.3% over the previous year.

Looking at the breakdown, hydropower generation increased by only 0.8% year-on-year in January-February due to poor precipitation in major watersheds since the beginning of the year. Changjiang Securities said, however, that the weak performance at the beginning of the year did not affect optimistic expectations for the whole year. The core is that in April and before, China's major watersheds were dry, and the impact on electricity throughout the year was relatively weak. In the future, with the continued interpretation of El Niño, incoming water is still expected to recover steadily.

Wind power generation increased 5.8% year on year in January-February. Although the growth rate was not very high, the core was the extremely high base figure brought about by the 30.2% growth rate in the same period last year. In January-February, PV power generation was 49 billion kilowatt-hours, up 15.4% year on year, continuing the steady growth rate of last year. Nuclear power generation was 69.1 billion kilowatt-hours, an increase of 3.5% over the previous year.

In terms of thermal power, thermal power generation increased 9.7% year on year in January-February. The strong performance of thermal power was mainly due to: 1) rapid growth on the demand side; 2) the growth rate of thermal power generation decreased by 2.3% year on year in the same period last year, and the low base made year-on-year growth relatively easy to a certain extent; 3) the weak output of wind power and hydropower also provided some room for thermal power growth. Changjiang Securities believes, however, that as the thermal power base began to rise after March of last year, it is expected that the growth rate of thermal power generation will gradually decline in the future.

Risk warning

1. There is a risk that electricity supply and demand will deteriorate; 2. There is a risk that wind conditions and incoming water from the lighting resource machine will fall short of expectations.