China Merchants Securities Report: Coal Power Capacity Price Mechanism to Stabilize Industry Expectations
A recent research report from China Merchants Securities has indicated that the coal power capacity price mechanism is “on the ground,” which is expected to further stabilize industry expectations and increase enthusiasm for power generation.
The report highlights the urgent need for coal power to play a supporting and regulating role in ensuring the safe and stable supply of electricity, particularly with the rapid development of new energy sources.
According to the report, under the current single electricity price mechanism, it has been difficult for coal-fired power companies to fully recover costs. Additionally, the high coal prices in recent years have led to severe losses among thermal power companies, resulting in unstable industry expectations and declining enthusiasm for power generation.
The introduction of the coal power capacity price mechanism is seen as a timely measure to address these challenges. It is expected to help power generation companies recover part or all of their fixed costs, stabilize coal power profit expectations, and ultimately lead to a revaluation of the thermal power industry.
The report’s findings come amid ongoing efforts in China to promote cleaner and more efficient energy production while ensuring a reliable power supply.
The implementation of the coal power capacity price mechanism is expected to have a positive impact on the industry by providing much-needed stability and support for coal power generation.
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