Electricity prices will not be adjusted in 2014

In December 2012, the "Guidance Opinion on Deepening the Market-oriented Reform of Coal Electricity" was promulgated, which stipulated the continued implementation and continuous improvement of coal price linkage mechanism. When the fluctuation of coal prices exceeds 5%, the annual on-grid tariffs will be adjusted accordingly. With the advent of 2014, the on-grid tariff adjustment has come to a time window. However, the reporter found that due to the "Guiding Opinions on Deepening the Reform of Coal-fired Power Markets," it did not explicitly state how to calculate the 5% rate of change, and coal and power companies collectively remained silent on coal-fired linkage mechanisms. The industry generally believed that It is difficult to cut down the on-grid tariff.

The calculation method should be clarified. Any head of the Development Planning Research Office of the National Grid Electric Power Research Institute told reporters that at present, over 70% of China's electricity supply is thermal power. Like electricity, grain and electricity, as a basic energy source for the country, power generation companies have been "securing" for a long period of time to maintain social stability. Therefore, we cannot cut down on-grid tariffs because coal prices have just fallen.

According to the coal and electricity linkage regulations, when the fluctuation of coal prices exceeds 5%, the annual on-grid tariffs will be adjusted accordingly. However, the 5% calculation method has left many people in the industry confused. Taking the Bohai Rim 5,500 kcal thermal coal price as an example, the last phase index of 2013 closed at 631 yuan/ton, which was still less than 1% compared with the price index of 633 yuan/ton in the first period of the year. However, the “coal price drop” dividends enjoyed by power companies are not the only ones. Since the price of thermal coal has been falling continuously during the first period, the price has dropped to RMB 530/ton, and the overall average price has dropped sharply. In 2013, the average coal price of 5,500 kcal coal was average. The price is 589 yuan / ton, compared with 633 yuan / ton at the beginning of the year, the decline is still more than 6%, the highest decline reached 16.2%.

However, people familiar with the matter explained that the coal-fired linkage policy actually began in late 2004. At that time, the state provided a coal price linkage cycle of not less than six months. If the average coal price in the cycle changes from the previous cycle, Or more than 5%, will adjust the price accordingly. In 2012, the relevant departments adjusted the coal pricing cycle to one year. In the policy of the coal price linkage mechanism that was introduced earlier, the National Development and Reform Commission has already provided for this, saying that coal price will be linked based on the comprehensive coal mining price (car price). This means that coal price linkages are based on changes in the average price of coal in the cycle. Based on this calculation, the decline in coal prices has been far more than 5%, which is in line with coal-fired power price linkage conditions.

Both parties are reluctant to cut the price of electricity Although the on-grid tariff cuts the window, electricity companies and coal companies are silent on this. Analyst Liu Dongnao, an analyst at Zhuochuang Information Technology Co., Ltd., believes that coal-fired power companies have accepted coal-fired power pricing policies. In the current silence of the industry, the National Development and Reform Commission or the Energy Administration will not generally impose a downward adjustment on the on-grid tariff.

The reporter learned from a number of people in the power and coal industry that, in fact, both parties are reluctant to lower the on-grid tariff. A power company source told reporters that due to the weakening of the macro economy, the utilization rate of power generation has decreased, which has brought great losses to the power generation companies. If the on-grid tariffs are cut, it will greatly offset the decline in the cost of coal to the efficiency of power companies. Good for coming.

The coal companies are also not happy to think that the efficiency of power companies continues to decline. According to a person listed in a coal company, coal companies and power companies are actually mutually beneficial in the entire power generation industry chain. The reduction in the profits of power generation companies will inevitably lead to the compression of costs for power generation companies, which will continue to suppress the price of coal.

Liu Yan, an energy analyst, is very certain that this round of on-grid tariffs will not be lowered. She told reporters that the development of coal-fired linkage policy from the formulation to the implementation of a running-in process, coal and power companies are reluctant to implement the policy. In fact, the sharp rise in coal prices at the end of the year has a lot to do with the concessions of power companies. The reason why the power companies accept the price increases of several major coal groups at the end of the year is to avoid coal-electricity linkages. From this perspective, both coal companies and electric power companies are subjectively evading the “red line” of coal-electricity linkages, and it is difficult to reduce the on-grid tariffs.

He Lianchu believes that coal-fired linkage is actually a transition plan for China's power system reform, and it has established clear rules for the game for coal companies, power companies, and users. However, the implementation process has been greatly reduced. When the coal price rose sharply, taking into account factors such as safeguarding the people's livelihood and social stability, the on-grid price did not appear to be raised several times.

The pressure on environmental protection of power companies has increased Although industry insiders generally believe that the arrival of the coal-electricity linkage time window will not result in the reduction of on-grid tariffs, many power generation companies have cut their on-grid tariffs from September to October last year. Power companies told reporters that since the second half of last year, the company’s operating costs have actually increased significantly. In addition to the economic slowdown that led to the decline in capacity utilization, environmental pressures have also contributed to the difficulty of continuing to improve the performance of power companies.

Since September last year, many provincial power companies have received notifications from the local price bureau about "relevant issues concerning adjustment of on-grid tariffs for power generation enterprises." The Development and Reform Commission issued a notice in October that it is clear that thermal power companies are planning to cut their prices by about 1 cent per degree to raise funds for renewable energy funds and to subsidize denitrifying dust collectors. Yanneng Power and SDIC Power took the lead in disclosing the above news.

Take Shanneng Group as an example, the company issued an announcement in early October that according to the notice of the National Development and Reform Commission, the company's power plant will cut its on-grid tariff by 0.01 yuan/kWh from the current 0.4852 yuan/kWh to 0.4752 yuan/kWh. According to the preliminary calculation of the company, the adjustment of the current price is expected to reduce the operating revenue of about 12 million yuan in 2013.

He Lianchu told reporters that the price adjustment of thermal power in October had nothing to do with the coal-fired linkage. The real reason is that thermal power companies cut prices to pay for new energy and environmental protection industries. Under the strong environmental protection pressures that govern smog across the country, thermal power companies' investment in desulfurization and denitrification has increased substantially. The government has attempted to indirectly subsidize investment in the construction of desulfurization and denitrification power generation equipment through regulation.

According to public information, the average denitrification cost for newly-built units of thermal power plants is about 1.2 cents/kWh, and that for active duty units is about 1.5 cents/kWh, and some specially-designed units may be higher than 2 points/kWh. With regard to denitrification alone, preliminary estimates suggest that the cost of retrofitting 707 million kilowatts of thermal power units in operation will total about 200 billion to 250 billion yuan; considering the “12th Five-Year Plan” for new thermal power units of 250 million kilowatts, environmental protection facilities will increase year-on-year due to increasing standards. The cost is about 90 billion yuan to 110 billion yuan. After the implementation of the environmental protection policy is fully implemented, the cost of thermal power companies will probably rise by 20% in the short term, resulting in a partial reversal of the power companies that made huge profits due to the decline in coal prices in the first half of last year.