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Thursday, 27 May 21
CHINA POWER DEMAND EXCEEDS PRE-COVID-19 LEVELS; THERMAL OUTPUT STRONG - FITCH RATINGS
 Rising Consumption: Total power consumption rose by 21.2% yoy to 1,921.9GWh in 1Q21 due to the fast recovery of China’s economy, after a drop of 6.5% in 1Q20 when market demand was dampened by the Covid-19 outbreak. Demand from the industrial sector, the main driver of power consumption growth, surged by 23.9% yoy in 1Q21.Consumption from the tertiary sector and agricultural users also jumped by 28.2% and 26.4%, respectively, during the quarter, Fitch Ratings says in its latest report.
Demand Exceeds Pre-Covid-19Levels
Power demand gained 14.4% in 1Q21 from 1Q19, driven by the industrial sector’s 15.3% increase and the tertiary sector’s 16.5% gain. Demand from agricultural users, which accounted for only 1.1% of total demand, surged by 31.3%in 1Q21 from 1Q19, led by the upgrade of power grids in rural areas.
Higher Contribution from Tertiary Sector
The contribution of the tertiary sector to consumption rose to 17.3% in 1Q21, from 16.7% in 1Q20. Tertiary demand was marked by the rapid consumption growth of information and technology services, which jumped by 26.5% on average in the past two years due to the fast development of big data, cloud computing and internet of things sector. Demand from the charging and battery swapping industry shot up by 92.2% on average in 2019 and 2020, the result of faster growth in the new-energy vehicle sector.
Thermal Power Underpins Generation Growth
Power generation rose by 19% yoy in 1Q21, primarily driven by thermal power’s output increase of21.1%, accounting for 73% of total power supply, which was 7pp higher than 2020. This was because of the higher output from heating power co-generation thermal units, and lower wind and solar contribution in winter.
Fuel Mix Continues to Improve
The proportion of coal-fired power capacity in China’s fuel mix decreased to 48.8% in 1Q21, after dropping to below 50% for the first time byend-2020. Fitch Ratings expects the share to drop in 2021, as China is promoting renewable energy to achieve net zero emissions by 2060. China added 23.5GW in power capacity in 1Q21, 55% of which were non-fossil fuels, including 5.33GWin solar power capacity, a 56% yoy gain, and 5.26GW in wind power capacity, a 123% jump. China also added 1.15GW in nuclear power capacity and 1.09GW in hydropower capacity in 1Q21.
Improving Coal-Fired Power Plants’ Flexibility
The report further noted that, some provinces, such as Shandong, have extended the service life of some large and efficient coal-fired power units, which also supply heat and have met environmental protection requirements This will ensure a stable power supply as renew able energy is usually affected by the intermittent nature of its source.
Utilisation Hours Improved in1Q21
Utilisation hours (UH) rose by 97 to 915 in 1Q21 from 1Q19 as power demand recovered further. Wind power UH improved by 69 hours to 619 hours, while solar power UH increased to 300 hours, up by 10 hours from1Q19. Yunnan, Sichuan and Jiangsu were the top-three provinces with the highest wind UH, while north-east and north-west China had the highest solar UH.
Thermal and nuclear power UH surged by 165 and 218, respectively, from 1Q20 due to strong consumption growth, higher connection priority for heat-power co-generation in the heating season, and lower output of hydropower, whose UH fell by 21 as a result of lower water flow.
Thermal power capacity installation rose by 10.6GW in 1Q21, including 4.77GW coal-fired power and 2.95GW gas-fired power, some of which were used for peak shaving. We expect renewable energy to continue to drive China’s power capacity installation in the rest of 2021 as the state is pushing for renewable energy to achieve carbon neutrality by 2060.Generation capex in 1Q21amounted to CNY79.5 billion, including 49.4% in wind, solar and biomass, 30.8% in hydro and 9.7% in nuclear. Capex contribution from thermal power fell to 10.1% in 1Q21, from 10.5% in 2020, under the government’s restrictions on thermal power installations given the environmental ramifications.
High Coal Prices to Squeeze Power Generating Companies’ Profit
Coal production rose 16% yoy to 970 million tonnes in 1Q21, slower than the 22% growth of coal-fired power output, resulting in higher coal prices. The Qinhuangdao 5,500 kcal/kg coal price rose 72.6% yoy to CNY 801/tonne by end April-2021. High coal prices will squeeze power generating companies’ profit and operating cash flow, which will be worsened by a lower coal-fired power tariff due to higher market trading volume.
By: Ms.Zhihua Zhang | Ms. Diana Xia
Fitch Ratings, China
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Friday, 23 February 24
STRONG OUTLOOK FOR THE TANKER MARKET IN 2024 AND BEYOND - DNV
Several factors have aligned over the past two years to create a robust and profitable market for tanker owners, which is expected to drive newbuil ...
Friday, 23 February 24
AUSTRALIAN COAL FLOWS TO ASIA HOVER ABOVE LAST YEAR’S VOLUME TONNES - SIGNAL GROUP
In the final days of February, the dry bulk freight market appeared to maintain a relatively stable momentum, particularly evident in the large ves ...
Friday, 23 February 24
RUSSIAN COAL SHIPMENTS FALL 14% AS SANCTIONS BITE - BIMCO
During the first seven weeks of 2024, Russian coal shipments have fallen 14% y/y. Volumes have gradually declined since October 2023 when logistica ...
Thursday, 22 February 24
BIMCO PUBLISHES SHIP FINANCING FORMS TO ENSURE UNINTERRUPTED USE OF SHIPS
BIMCO has published two standard Quiet Enjoyment Letters (QELs), the first standard form QELs available to the industry, to offer a tool that can e ...
Monday, 19 February 24
METALS INVESTMENT: THE DARKEST HOUR IS JUST BEFORE THE DAWN - WOOD MACKENZIE
Things often seem at their worst just before they get better. In terms of meeting our net zero 2050 scenario, we’ve reached a watershed momen ...
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- GN Power Mariveles Coal Plant, Philippines
- Borneo Indobara - Indonesia
- Sakthi Sugars Limited - India
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Bayan Resources Tbk. - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Indo Tambangraya Megah - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Wilmar Investment Holdings
- MS Steel International - UAE
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Goldman Sachs - Singapore
- Anglo American - United Kingdom
- Indonesian Coal Mining Association
- Ceylon Electricity Board - Sri Lanka
- Independent Power Producers Association of India
- Ambuja Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- LBH Netherlands Bv - Netherlands
- Price Waterhouse Coopers - Russia
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- Merrill Lynch Commodities Europe
- Deloitte Consulting - India
- Tata Chemicals Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Grasim Industreis Ltd - India
- Siam City Cement PLC, Thailand
- Trasteel International SA, Italy
- Sinarmas Energy and Mining - Indonesia
- Africa Commodities Group - South Africa
- Iligan Light & Power Inc, Philippines
- India Bulls Power Limited - India
- Riau Bara Harum - Indonesia
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- The University of Queensland
- Interocean Group of Companies - India
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Bhushan Steel Limited - India
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- McConnell Dowell - Australia
- Orica Australia Pty. Ltd.
- Cigading International Bulk Terminal - Indonesia
- Posco Energy - South Korea
- Samtan Co., Ltd - South Korea
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Indian Oil Corporation Limited
- ICICI Bank Limited - India
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- Economic Council, Georgia
- SMC Global Power, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- Jindal Steel & Power Ltd - India
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- Commonwealth Bank - Australia
- Global Coal Blending Company Limited - Australia
- GVK Power & Infra Limited - India
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- Semirara Mining Corp, Philippines
- Antam Resourcindo - Indonesia
- Marubeni Corporation - India
- Toyota Tsusho Corporation, Japan
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thiess Contractors Indonesia
- Coalindo Energy - Indonesia
- Indogreen Group - Indonesia
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Jaiprakash Power Ventures ltd
- Asmin Koalindo Tuhup - Indonesia
- Minerals Council of Australia
- Larsen & Toubro Limited - India
- OPG Power Generation Pvt Ltd - India
- Bharathi Cement Corporation - India
- The Treasury - Australian Government
- Mjunction Services Limited - India
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Pendopo Energi Batubara - Indonesia
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Parliament of New Zealand
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aboitiz Power Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- Directorate General of MIneral and Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement - Thailand
- Medco Energi Mining Internasional
- Semirara Mining and Power Corporation, Philippines
- Romanian Commodities Exchange
- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Latin American Coal - Colombia
- Kartika Selabumi Mining - Indonesia
- London Commodity Brokers - England
- Maharashtra Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Vijayanagar Sugar Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Heidelberg Cement - Germany
- San Jose City I Power Corp, Philippines
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Cement Manufacturers Association - India
- Malabar Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Chettinad Cement Corporation Ltd - India
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- VISA Power Limited - India
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Attock Cement Pakistan Limited
- Coal and Oil Company - UAE
- Energy Development Corp, Philippines
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- IEA Clean Coal Centre - UK
- Petron Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- SMG Consultants - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- GMR Energy Limited - India
- European Bulk Services B.V. - Netherlands
- Electricity Authority, New Zealand
- Manunggal Multi Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- PNOC Exploration Corporation - Philippines
- Power Finance Corporation Ltd., India
- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- The State Trading Corporation of India Ltd
- Planning Commission, India
- Pipit Mutiara Jaya. PT, Indonesia
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercator Lines Limited - India
- Agrawal Coal Company - India
- Wood Mackenzie - Singapore
- Port Waratah Coal Services - Australia
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Parry Sugars Refinery, India
- Singapore Mercantile Exchange
- Billiton Holdings Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- Mercuria Energy - Indonesia
- Global Business Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Binh Thuan Hamico - Vietnam
- South Luzon Thermal Energy Corporation
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