The golden decade of the coal industry has started a boom cycle for the power industry. The power industry, which has been depressed by coal prices for a long time, may fight a turnaround this year. The coal price, which has fallen since the end of last year, has not yet fallen to its end. The comprehensive average price of thermal coal in the 5,500 kcal market in the Bohai Rim region recently closed at 631 yuan/ton, a 22% drop from the beginning of the year. Peng Quangang, an industry analyst at China Merchants Securities, pointed out that a 1 percentage point drop in coal prices will increase the profits of thermal power companies by 2.7 percentage points. According to this calculation, so far, the profit of the thermal power industry has increased by at least 50%.

thermal power "turn over"

The latest data released by the Maritime Coal Network on July 25 showed that the comprehensive average price of thermal coal in the 5,500 kcal market in the Bohai Rim area closed at 631 yuan/ton, a decrease of 10 yuan/ton from the previous reporting period. On December 28, 2011, the average price of thermal coal reached 808 yuan/ton, which means that coal prices have fallen by nearly 22% this year.

As coal costs account for about 70% of the cost of thermal power companies, the sharp drop in coal prices is undoubtedly good news for the thermal power industry. As of July 26, 13 A-share thermal power companies have issued interim results forecasts, and 3 have announced interim results express reports. The data shows that the thermal power industry is generally improving. Among them, Jiantou Energy (000600) and *ST Ganneng (000899) turned losses in the first half of the year, and the main reason for the turnaround was the increase in the gross profit of the main thermal power business.

Shanghai Electric Power (600021), Wanneng Power (000543), Shaoneng Power (000601) are expected to increase their interim results. Among them, Shanghai Electric Power is expected to have the lowest growth rate, but it also reaches 50%. Wanneng Power is expected to increase its performance the most, and its net profit in the first half of the year is expected to increase by 121.86% to 168.08%. Wanneng Power said that the improvement in performance was mainly due to the increase in on-grid power prices over the same period last year and the increase in power generation over the same period last year. The company's main business income increased by approximately 58.85% over the previous year. The company's main business power products realized a turnaround. Surplus.

Due to the long-term upside down of coal power prices, most thermal power companies are still losing money. Among the 16 companies that have announced mid-term forecasts or express reports, 7 have "continued losses." The good news is that the losses of most companies have decreased significantly. Changyuan Power (000966) stated that the main reason for the narrowing of losses was that, starting from the second quarter of 2012, affected by the international and domestic economic conditions, fuel prices have fallen.

Peng Quangang pointed out that the power industry has obvious counter-cyclical characteristics, the economy is slowing down, and coal prices have fallen. However, the electricity price of the power industry is relatively sticky and the price of electricity will not be reduced in the short term. Therefore, the profitability of the power industry is bound to improve.

Hydropower

"If it were not for the huge hydropower generation, the profit improvement of the thermal power industry would be more obvious." A related person in charge of the thermal power plant revealed to the reporter that the company has stopped a generator set.

Due to good water supply conditions, thermal power was transferred to hydropower in part of the market in the first half of the year. Statistics show that in the first half of the year, the national average precipitation was 267.6 mm, which was 3.1% higher than the normal average and 28.6% higher than the same period in 2011; cumulative hydropower generation increased by 9.9% year-on-year. The accumulated utilization hours of hydropower were 1,455 hours, a year-on-year increase of 3%.

The total national power generation in the first half of the year was 2.29 trillion kWh, an increase of 3.7% over the same period last year. In other words, the rise in hydropower generation is bound to occupy the space of thermal power. In order to fully absorb hydropower, relevant provinces generally arrange grid operation according to the minimum thermal power startup method.

As the first company in the power industry to issue an interim report, the performance of Three Gorges Water (600116) can represent the performance of the hydropower industry in the first half of the year.

Three Gorges Water Conservancy achieved a net profit of 34,474,300 yuan in the first half of the year, a year-on-year increase of 713.40%.

According to the company, during the reporting period, due to the successful commissioning of two units of Yangdonghe Hydropower Station for power generation, and the fact that the company’s hydropower station was located in a river basin where precipitation and inflows were high, the company’s spontaneous hydropower increased significantly year-on-year and the cost of outsourcing electricity decreased, resulting in a year-on-year decrease in the company’s operating profit. A substantial increase.

As of July 26, among the 10 hydropower companies that announced their interim results, 5 companies are expected to increase, the minimum increase is between 30%-50%, and the maximum increase reaches 100%. Although Xichang Power (600505) and Qianyuan Power (002039) lost money in the first half of the year, Qianyuan Power announced that less precipitation in the southwest region in the first quarter caused the company to lose money, and increased rainfall in the second quarter. The company's single-quarter profit was around 60 million yuan.

Rainfall in the second half of the year cannot be accurately estimated, but in July, all parts of the country entered a critical period of flood control, and heavy rainfall occurred in parts of North China, Northeast China, and South China. This means that the boom cycle of hydropower can last at least until July.