Soochow Securities·2025-02-26 10:20Investment Rating - The report suggests focusing on waste incineration companies that align with the national "East Data West Computing" project in key regions [6]. Core Viewpoints - The report emphasizes the high energy consumption of data centers and the need for green low-carbon development, with specific policies aiming to reduce energy usage and increase renewable energy utilization by 2025 [4][11]. - Waste incineration is highlighted as a clean and efficient energy source that can support data centers, providing stable and economically advantageous power compared to other renewable sources [4][24][30]. Summary by Sections Data Center Energy Consumption and Policy Development - Data centers in China consumed 150 billion kWh in 2023, a 15% increase year-on-year, accounting for 1.6% of the total national electricity consumption [10][11]. - The average Power Usage Effectiveness (PUE) of data centers improved from 1.52 in 2022 to 1.48 in 2023, with a target to reduce it below 1.5 by 2025 [13][14]. Waste Incineration Supporting Ultra-Low PUE Zero Carbon Projects - The Pudong Limin Smart Computing Center project aims to utilize 70% green electricity from a waste incineration facility, achieving ultra-low PUE and zero carbon emissions [19][20]. Advantages of Waste Incineration IDC Cooperation - Waste incineration provides clean and efficient energy, with the potential to significantly reduce cooling system energy consumption through the use of waste heat [25][30]. - The stability of waste incineration energy supply is superior to other renewable sources, with effective operating hours exceeding 8,200 hours per year [29]. - The average operating cost of waste incineration power generation is approximately 0.37 yuan per kWh, making it economically favorable compared to other renewable energy sources [30][33]. Potential for Waste Incineration IDC Cooperation - Key regions for waste incineration IDC cooperation include the Yangtze River Delta, Beijing-Tianjin-Hebei, and Guangdong-Hong Kong-Macau, where waste incineration capacity is significant [40][46]. - The report identifies specific companies with substantial operational capacity in these regions, such as Yongxing Co. and Yuefeng Environmental [46][47]. Profitability and Cash Flow Improvement from Waste Incineration IDC Cooperation - The collaboration between waste incineration and data centers is expected to enhance profitability and improve cash flow, with potential revenue from both electricity and steam supply [49][56]. - The average electricity price for waste incineration projects is projected to remain competitive, even exceeding coal benchmark prices for non-subsidized projects [56].