Core Viewpoint - The successful grid connection of the Huaneng Shandong Peninsula North L offshore wind power project marks a significant breakthrough for China's offshore wind power in deep waters, indicating a new direction for clean energy development in the country [1][2]. Group 1: Project Details - The Huaneng Shandong Peninsula North L offshore wind power project has a total installed capacity of 504,000 kilowatts and an annual power generation of approximately 1.7 billion kilowatt-hours, saving about 500,000 tons of standard coal each year [2]. - This project is not only the deepest offshore wind power project in commercial operation in China but also the farthest offshore and has the largest single unit capacity in Shandong Province [2]. - The project employs an innovative four-pile jacket foundation structure, reaching a height of 83.9 meters, which is the highest of its kind in the country, ensuring the safety and stability of wind turbines in complex geological environments [2]. Group 2: Industry Trends and Future Outlook - The successful grid connection of this project is seen as a key direction for future clean energy capacity additions, driving upgrades and innovations across the entire industrial chain, including high-end equipment manufacturing and intelligent operations [2]. - By 2035, China aims to achieve a wind and solar installed capacity of 3.6 billion kilowatts, with deep offshore wind power becoming an essential battlefield due to limited resources on land and nearshore [2]. - The offshore wind power sector is expected to enter a high-speed development phase during the 14th Five-Year Plan period, with annual new installed capacity projected to be no less than 15 million kilowatts [7]. Group 3: Policy Support - Recent government policies, including a 50% VAT refund for electricity generated from offshore wind, are expected to significantly reduce operational costs and enhance project profitability [5]. - The National Energy Administration has emphasized the need to promote deep offshore wind power development and is working on relevant planning and management policies to facilitate orderly construction [4][5]. - The focus of offshore wind power development is shifting from nearshore to deep offshore, with technological innovations moving towards more adaptable floating wind technologies [8]. Group 4: Market Activity - Several listed companies are actively entering the offshore wind power market, with Jinlun Technology launching a new generation of wind power products designed for deep offshore applications [8]. - The market is expected to see a significant increase in offshore wind turbine bidding, with projections of 15 to 20 gigawatts in 2026, setting a new historical high [7].

Investment Rating - The report maintains a "Positive" investment rating for the utility sector [8] Core Insights - The adjustment of coal power capacity prices in Tianjin exceeds expectations, with the fixed cost recovery ratio increasing to 70% from January 1, 2026, which is higher than the previously planned minimum of 50% [2][11] - The January 2026 proxy purchase electricity prices show a general decline across most provinces, with significant regional disparities; northern inland areas exhibit more resilience compared to coastal regions facing greater pressure [2][11] Summary by Sections Capacity Price Adjustment - Tianjin's coal power capacity price will rise from 100 yuan per kilowatt per year to 231 yuan, enhancing the fixed cost recovery ratio to 70% [2][11] - The adjustment is expected to yield an increase of approximately 0.035 yuan per kilowatt-hour in electricity pricing, although actual capacity fees may rise more significantly due to declining coal power utilization hours [11] Proxy Purchase Electricity Prices - January 2026 proxy purchase prices show a decline, with Guangdong and Jiangsu reporting average transaction prices of 372.14 yuan per megawatt-hour and 344.19 yuan per megawatt-hour, respectively, reflecting year-on-year decreases of 19.72 yuan and 68.26 yuan [11] - Northern inland regions, such as Inner Mongolia, show a year-on-year increase in proxy purchase prices, while coastal provinces like Guangdong and Jiangsu face declines exceeding 5 fen per kilowatt-hour [11] Investment Recommendations - The report recommends focusing on quality coal power operators such as Huaneng International, Datang Power, and Guodian Power, as well as hydropower companies like Yangtze Power and State Power Investment Corporation [11][16][17] - It also highlights the potential of new energy companies like Longyuan Power and China Nuclear Power, suggesting a favorable long-term outlook for the sector [11][20]

据悉，该项目创新应用四桩导管架基础结构，最高可达83.9米，可有效确保风机在深远海复杂地质环境 下安全稳定运行。项目依托北斗系统研发了高精度定位技术，实现海底沉桩的毫米级施工定位，结合智 能辅助沉放技术，将深远海单台风机沉桩作业时间从48小时缩短至29小时。借助无人机与人工磁场协同 技术，项目完成了95.6公里超长海缆铺设。(完) （文章来源：中国新闻网） 中新社山东烟台1月7日电 (记者王娇妮)记者7日从中国华能集团有限公司获悉，中国水深最深的商运海 上风电项目当日在山东半岛北黄海海域并网发电，标志着中国商运海上风电在深远海领域实现新突破。 华能山东半岛北L场址海上风电项目总装机50.4万千瓦，安装42台12兆瓦风力发电机组，场址中心离岸 约70公里，水深52米至56米，为中国水深最深的商运海上风电项目，年发电量约17亿千瓦时，每年可节 约标准煤约50万吨。 ...

（央视财经《天下财经》）记者今天（7日）从中国华能获悉，我国水深最深的海上风电项目——华能山东半岛北海上风电 项目并网发电，标志着我国商运海上风电在深远海领域实现新突破。 华能山东半岛北海上风电项目位于烟台牟平海域，总装机50.4万千瓦，安装42台12兆瓦风力发电机组，场址中心离岸约70公 里，水深52—56米，为我国水深最深的商运海上风电项目。项目创新应用四桩导管架基础结构，最高可达83.9米，为国内同 类型最高，可有效确保风机在深远海复杂地质环境下的安全稳定。 转载请注明央视财经 编辑：王一帆 ...

Core Insights - The National Energy Group has undergone a significant organizational restructuring, shifting from 17 departments to a new "1+22" framework, indicating a strategic transformation aimed at enhancing internal capabilities and adapting to future challenges [1][6]. Group 1: Organizational Changes - The restructuring reflects a broader trend in the energy sector, with the frequency of leadership changes among the five major power generation groups reaching its lowest point since the 2015 electricity reform, suggesting a shift towards internal consolidation rather than external leadership changes [1][6]. - The establishment of independent divisions, such as the Hydrogen Energy Division, allows for dedicated focus and resource allocation, moving away from competing for attention within traditional coal and power sectors [2][6]. - The creation of the Engineering Management Department (Major Project Construction Office) addresses the challenge of managing numerous projects, with a focus on specialized oversight [3][6]. Group 2: Strategic Focus Areas - The introduction of the Brand Management Department signifies a recognition of the importance of branding in attracting talent and capital, moving beyond traditional operational focuses [4][6]. - The establishment of the 2030 Major Special Project Management Office emphasizes the urgency of achieving carbon peak goals by 2030, indicating a commitment to a structured approach in managing innovation and research investments [4][6]. - The independent placement of the Discipline Inspection and Supervision Group highlights an increased emphasis on oversight and accountability within the organization, crucial for navigating the complexities of the energy sector [5][6]. Group 3: Broader Industry Implications - The restructuring at the National Energy Group is indicative of a larger shift in the energy industry, where competition is increasingly based on organizational capability and strategic endurance rather than just scale and speed [6]. - The changes may prompt other energy giants to follow suit, potentially redefining the competitive landscape of the energy sector as focus areas like hydrogen, digitalization, and brand development become strategic units rather than mere departmental functions [6].

Group 1 - The core viewpoint of the report indicates that Huaneng International Power Co. (600011) is placed on a downward catalyst watch list due to the expected market basic electricity price for 2026 being lower than market expectations [1] - Citigroup sets a target price of HKD 7.2 for Huaneng and maintains a "Buy" rating [1] - The report highlights that 63.5% of Huaneng's electricity sales in the first three quarters of 2025 are derived from Guangdong, Zhejiang, and Jiangsu provinces, where the weighted average market basic electricity price is projected to decrease by 13.4% year-on-year in 2026 [1] Group 2 - The report anticipates a 65% year-on-year increase in electricity generation capacity from coal-fired power plants in China [1] - It is expected that Huaneng's average coal-fired electricity price will decrease by 8.9% year-on-year in 2026 [1]

Core Viewpoint - Citigroup has placed Huaneng International Power Co., Ltd. (00902) on a downward catalyst watch list due to the market's basic electricity price for 2026 appearing to be lower than market expectations, with a target price set at HKD 7.2 and a "Buy" rating [1] Group 1: Company Performance - Huaneng International's electricity sales in China for the first three quarters of 2025 are derived 63.5% from Guangdong, Zhejiang, and Jiangsu provinces [1] - The weighted average market basic electricity price in these three provinces is expected to decrease by 13.4% year-on-year in 2026 [1] Group 2: Industry Trends - The electricity generation capacity of coal-fired power plants in China is projected to increase by 65% year-on-year [1] - The average coal-fired electricity price for Huaneng in 2026 is anticipated to decline by 8.9% year-on-year [1]

Core Viewpoint - Citigroup has placed Huaneng International Power Co. on a watchlist for downward catalysts due to the market's basic electricity price for 2026 appearing lower than expected [1] Group 1: Market Conditions - Huaneng's electricity sales in the first three quarters of 2025 are derived 63.5% from Guangdong, Zhejiang, and Jiangsu provinces [1] - The weighted average market basic electricity price in these three provinces is projected to decline by 13.4% year-on-year for 2026 [1] Group 2: Production and Pricing Forecast - China's coal-fired power plants are expected to see a year-on-year capacity increase of 65% [1] - Huaneng's average coal-fired electricity price is anticipated to decrease by 8.9% year-on-year for 2026 [1] Group 3: Investment Rating - Citigroup has set a target price of HKD 7.2 for Huaneng and maintains a "Buy" rating [1]

Investment Rating - The report maintains a positive outlook on the power and gas sectors, indicating potential investment opportunities in these areas [1]. Core Insights - The 2026 long-term electricity prices are under pressure, with significant declines observed in transaction prices across various provinces, reflecting a shift in the power generation model from reliance on thermal power to a more diversified income structure [6][7]. - Natural gas consumption saw a year-on-year increase of 5.1% in November 2025, indicating a recovery in demand, particularly due to heating needs during the winter season [34]. - The report highlights the importance of optimizing the electricity market mechanism and restructuring the power generation mix as key future trends [7]. Summary by Sections 1. Electricity: 2026 Long-term Electricity Prices - The annual transaction results for 2026 show a total transaction volume of 2,724.81 billion kWh in Jiangsu, with a weighted average price of 344.19 yuan/MWh, down 16.55% from the previous year [6][8]. - Similar trends are observed in Guangdong and Anhui, with prices decreasing by 5.03% and 10.09% respectively [6][8]. - The report suggests that coastal provinces will face significant pricing pressure in 2026, as the role of thermal power shifts from being the main energy source to a regulatory support role [7]. 2. Gas: November Natural Gas Consumption - In November 2025, the apparent consumption of natural gas reached 362.8 billion m³, marking a 5.1% increase year-on-year, while the total consumption from January to November was 3,880 billion m³, a slight decline of 0.1% [34]. - The report notes that the increase in consumption is attributed to a low base from the previous year and a recovery in industrial gas demand [34]. - The report also highlights a favorable trend in natural gas pricing, with a decrease in costs due to lower international oil prices and improved supply conditions [36]. 3. Investment Analysis Recommendations - For thermal power, the report recommends companies with integrated coal and power operations, such as Guodian Power and Inner Mongolia Huadian, as well as those with significant large unit ratios like Datang Power and Huaneng International [10]. - In the hydropower sector, companies like Yangtze Power and Guotou Power are recommended due to their sufficient capacity and expected improvements in profit margins [10]. - The report suggests focusing on nuclear power companies like China Nuclear Power and China General Nuclear Power, which have stable cost structures and high utilization hours [10]. - For green energy, companies such as Xintian Green Energy and Longyuan Power are highlighted for their stable returns and increasing operational benefits from environmental value releases [10].

Investment Rating - The industry investment rating is "Buy" [2] Core Insights - The annual long-term contract electricity prices are reaching a bottom, with a focus on the dividend value of the sector. The electricity price in Guangdong is 0.372 CNY/kWh, down 0.02 CNY/kWh year-on-year, reflecting a 20% decrease from the benchmark. In Jiangsu, the price is 0.344 CNY/kWh, down 0.07 CNY/kWh year-on-year, a 12% drop from the benchmark. The market has reacted negatively to these price drops, but the long-term outlook suggests limited further declines as supply and demand improve [6][17][24]. Summary by Sections 1. Annual Long-term Contract Electricity Results - The annual electricity trading results for 2026 show significant price reductions in Guangdong and Jiangsu, with declines of 20% and 12% respectively. The transition from annual to monthly contracts is noted, with a high proportion of medium to long-term market electricity remaining stable [17][24]. 2. Weekly Review - The report highlights the recent implementation of local electricity pricing mechanisms, with a focus on the impact of coal prices and the stability of natural gas prices compared to previous years [10][18]. 3. Industry High-frequency Data Tracking - The report tracks the rapid decline in spot coal prices and the decrease in coal inventories at northern ports. The domestic natural gas prices are lower than the previous year, while overseas prices are fluctuating upwards [10][18]. 4. Key Company Announcements and Sector Performance Tracking - The report emphasizes the acquisition by Guiguan Electric Power of assets from its parent group, which is expected to enhance its growth potential. The company plans to lead the development of hydropower and new energy in Tibet, which could significantly boost profits in the coming quarters [6][10][18]. 5. Focus on Investment Opportunities - The report identifies several companies with strong dividend yields and market management strategies, including Huaneng International, Huadian International, and Guiguan Electric Power. The focus is on high dividend stocks and companies with robust market management practices, which are expected to enhance their valuation [6][10][18]. 6. Valuation and Financial Analysis of Key Companies - The report provides a detailed valuation analysis of key companies in the sector, indicating potential upside in their stock prices based on projected earnings and dividend increases. For instance, Guiguan Electric Power's acquisition is valued at 2.025 billion CNY, with a price-to-book ratio of 1.06 [7][10]. 7. Market Positioning and Future Outlook - The report concludes with a positive outlook for the public utility sector, suggesting that the current valuation levels are attractive for new investments, especially as the market begins to stabilize and recover from recent price declines [6][10][18].