The Zhitong Finance App learned that Guotai Junan released a research report saying that the potential direction of electricity market-based reform is: 1) medium- to long-term trading market: gradually liberalizing price limits, driving the share of new energy sources to further increase the share of market-based electricity; 2) spot market: construction progress is accelerating and gradually becoming a core component of the electricity market system; 3) capacity electricity price market: the coal and electricity capacity compensation ratio gradually increases, and eventually the transition to the capacity market electricity price; 4) Auxiliary service market: more diverse products, and the user side gradually incorporates auxiliary service cost sharing parties; 5) Green power market The category market is promising It is organically unified, and the market size is expected to continue to expand.

Guotai Junan's views are as follows:

Progress in the market-based reform of electricity: The electric energy market was gradually improved, and other emerging markets were initially established.

1) China's medium- to long-term electricity trading ratio is already at a high level, but trading electricity prices are still limited; 2) China's spot electricity market is gradually accelerating, and the first batch of spot pilot provinces “corrected” one after another; 3) the size of China's auxiliary services market is gradually expanding, but the types of market transactions are still relatively single; 4) Pumped storage, coal power, and some gas and electricity have implemented capacity-compensated electricity prices, but the coal and gas capacity compensation standards are still insufficient to recover fixed asset investment costs.

Characteristics of the electricity market-based reform: the difficulty is gradually increasing, and the process is developing “step by step”.

Looking at the long-term cycle, the bank believes that the core context of China's electricity market-based reform is: administrative instructions break vertical integration monopolies and achieve competitive resource allocation through market-based means. China's electricity market-based reform shows two major characteristics: 1) The difficulty of electricity market-based reform is gradually increasing: the sixteen-character policy of “separation of the factory network, separation of main and auxiliary networks, separation of transmission and distribution, and internet bidding”. Among them, the “separation of the factory network and separation of main and auxiliary components” have basically been completed; 2) Historical electricity market-based reform processes have often developed “step-wise”. Since the main structure involved in the reform is complex, it is often necessary to be boosted by “external forces” to achieve “step-wise” development.

Prospects for the market-based reform of electricity: Providing full pricing for all attributes of electricity commodities to protect the long-term sustainable development of new power systems.

The bank predicts that the potential direction of electricity market-based reform is: 1) medium- and long-term trading market: price limits are gradually being liberalized, and the share of market-based electricity is further increasing due to the entry of new energy sources; 2) spot market: construction progress is accelerated and gradually becomes a core component of the electricity market system; 3) capacity electricity price market: the proportion of coal and electricity capacity compensation gradually increases, and eventually the electricity price of the capacity market is expected to gradually expand; 4) auxiliary service market: the variety of products is expected to gradually be incorporated into the auxiliary service cost sharing party; 5) green electricity market: various types of markets are expected to be organically unified, and the market size is expected to continue to expand.

Investment suggestions: The potential impact of electricity market-based reforms on various power sources is: 1) thermal power: increased profit stability in the industry, differentiation of profits within the unit; 2) hydropower & nuclear power: implied excess income options; 3) New energy: there are hidden concerns about short-term yield, and long-term electricity reform helps the industry to develop sustainably. The bank recommends leading companies in various power generation segments with competitive advantages: 1) thermal power; 2) hydropower; 3) nuclear power; 4) new energy.

Risk factors: Demand for electricity falls short of expectations, profits from new energy sources are lower than expected, electricity prices are lower than expected, coal prices have exceeded expectations, and progress in electricity marketization has fallen short of expectations.