The direction of the US general election is changing, and the attitude towards the energy industry may gradually become an area of lesser disagreement and contradiction in the ruling of the two parties.
Zhixin Finance and Economics app learned that Sinolink Securities released a research report, suggesting that the change in the direction of the US general election, and the attitude towards the energy industry may gradually become an area of lesser disagreement and contradiction in the ruling of the two parties. Combined with the expectation of the Fed’s interest rate cut nearing landing, the development of new energy projects will be a direct beneficiary of the rate cut. The resonance of the two major factors is expected to drive the emotions and expectations of the electrical new sector, especially the outflow related industrial chain, to significantly recover. It is recommended to increase the allocation of relevant symbols. In addition, the mid-term performance of many key companies in the electricity sector meets or exceeds expectations, dispelling market concerns about Q2 performance, so the sector has seen a contrarian rise in the past month.
Photovoltaic & energy storage: The direction of the US general election is changing, and the attitude towards the energy industry may gradually become an area of lesser disagreement and contradiction in the ruling of the two parties. Combined with the expectation of the Fed’s interest rate cut nearing landing, the development of new energy projects will be a direct beneficiary of the rate cut. The resonance of the two major factors is expected to drive the emotions and expectations of the electrical new sector, especially the outflow related industrial chain, to significantly recover. It is recommended to increase the allocation of relevant symbols.
Power grid: The mid-term performance of many key companies meets or exceeds expectations, dispelling market concerns about Q2 performance, so the sector has seen a contrarian rise in the past month. Looking ahead to September-December, in terms of outflow, power transformers, high-voltage switches, and smart meters are expected to enter a concentrated delivery phase in the third and fourth quarters. In terms of the domestic market, ultra-high pressure and power transmission and transformation projects are welcoming intensive bidding, and direct current projects are being delivered in succession. There is also room for improvement in offshore new energy + industrial demand outside the grid, reaffirming the opportunity for domestic and overseas performance beyond expectations.
Wind power: China General Nuclear Power Corporation's platform released the 'Yangjiang Fanshi Phase One Offshore Wind Farm Project First Delivery 500kV Submarine Cable and Laying' tender announcement, with the first batch of equipment planned to be delivered on April 1, 2025. The Guangdong Offshore Wind Project is progressing and showing bullish signals again, and there is hope for accelerated installation in the late stage of the 'Fourteenth Five-Year Plan'. This tender project will use a 500kV ultra-high voltage level submarine cable, and requires bidders to have at least one performance in supplying sea cables of 220kV and above. As domestic offshore wind projects move towards the deep sea, the value and threshold of equipment such as submarine cables are expected to further increase.
Hydrogen energy and fuel cells: The Energy Law draft has been submitted for a second review, with provisions for the development and utilization of hydrogen energy, marking the first major proposal, with the importance of hydrogen energy being mentioned by central authorities multiple times, and the subsequent refinement of policies is brewing. The gradual promotion of ammonia use has led Foshan to promote the application of ammonia instead of natural gas combustion. The 'gas-to-ammonia' subsidy benchmark of 1000 yuan/ton is expected to be progressively followed by other provinces and cities, driving the growth of demand for synthetic ammonia in the domestic industrial sector.
Important industry events this week:
Solar, storage, and wind: Unexpectedly, Trump expressed a positive attitude towards solar energy during the US election debate; The impact of the US imposing tariffs on multiple industries with China has little effect on the increase in photovoltaics; CGN Power announced the tender notice for the "Yangjiang Fanshi Phase I Offshore Wind Farm 500kV Submarine Cable and Laying" project; Autowell signed a 0.9 billion yuan overseas customer monocrystalline furnace order.
Power grid: South China Power Grid Company will increase the proportion of prepaid payments for small and medium-sized enterprises; The first pilot project of smart distribution network increment distribution business in China has been successfully evaluated; Mr. Zhao Qi, Chairman of China XD Electric, resigned due to job changes; Zhu Qiqi, General Manager of Pinggao Electric, resigned, and Zhang Guoyue took over.
Hydrogen and Fuel Cells: The draft of the Energy Law has been submitted for second review, which includes provisions on the development and utilization of hydrogen energy; The first MW-level AEM electrolysis hydrogen production station in China has started EPC bidding; 4 hydrogen energy technologies have been included in the 2024 version of the first promotion catalog, promoting the development of hydrogen-powered trains and ships; Henan province has implemented a "trade-in" policy for fuel cell vehicles, with an additional subsidy of 0.15 million yuan per vehicle.
Risk Warning: Risks of policy adjustments and lower-than-expected implementation effectiveness; Risks of more intense price competition in the industry chain than expected.
