Investment Rating - The report maintains a "Recommended" investment rating for the environmental and public utility sector [2] Core Insights - The environmental sector index increased by 0.26%, while the public utility sector index decreased by 1.19%, indicating a divergence in performance [7] - The report highlights the ongoing pilot projects in hydrogen energy, aiming to support the entire chain of hydrogen "production, storage, transportation, and utilization" [11] - The report emphasizes the need for market-oriented measures in electricity management, particularly in cross-provincial emergency dispatching [11] Summary by Sections Key Event Interpretations - The National Energy Administration has initiated hydrogen energy pilot projects to promote clean energy consumption in various sectors [11] - The National Development and Reform Commission has proposed a management method for cross-provincial electricity emergency dispatching to ensure power supply safety [11] Market Performance Review - The environmental sector has shown a cumulative increase of 6.01% since the beginning of 2025, outperforming the Shanghai and Shenzhen 300 indices [7] - The report notes that the coal price remains low, with Qinhuangdao's 5500 kcal thermal coal price at 620 CNY/ton, a significant drop from previous highs [23][24] Industry Data Tracking - As of June 13, 2025, the water level of the Three Gorges Reservoir is 150.66 meters, showing a year-on-year increase of 1.6% [25] - The report tracks the price of polysilicon, which has decreased to 35 CNY/kg, reflecting ongoing price adjustments in the market [40] Key Industry Events - The report discusses the implementation of various policies aimed at promoting hydrogen energy and carbon emission reduction across different provinces [54][55]

Market Overview - US stock market declined on Wednesday, with the S&P 500 ending a three-day rally, which may put pressure on A-shares at the opening [2] - The China Golden Dragon Index rose by 0.08%, indicating a positive performance for Chinese concept stocks [2] Technical Analysis - The Shanghai Composite Index closed at 3402.32 points, maintaining above the 3400 mark, but trading volume decreased to 1.26 trillion, down 160 billion from the previous day, suggesting weak buying interest [2] - If trading volume remains low, the index may test the 3380 point support level [2] - The ChiNext Index increased by 1.21%, but the new energy sector lagged, with Ningde Times affecting overall sentiment [2] - The brokerage sector saw a net inflow of 3.7 billion, indicating potential upward movement if major brokers like CITIC Securities and Oriental Fortune show strong early performance [2] Policy Directions - Three key policy directions identified: 1. US-China trade talks focusing on rare earth and semiconductor equipment exports, with China issuing temporary export licenses for rare earth materials to three major US automakers [3] 2. Hydrogen energy pilot projects, with the National Energy Administration outlining directions for green hydrogen production and zero-carbon parks, potentially benefiting equipment manufacturers like Hupu Co. and Xue Ren Co. [3] 3. Local special bonds issuance, with 180 billion issued in the first two weeks of June, likely stabilizing infrastructure stocks like China Communications Construction and China Railway Construction [3] Sector Rotation - Focus on whether technology and brokerage sectors can resonate positively in early trading [3] - The AI computing industry chain may see funding inflows due to the upcoming delivery of Nvidia's Blackwell chips [3] - Defensive sectors like Yangtze Power, with a dividend yield over 5%, and Hu Nong Commercial Bank, known for low valuation and high dividends, are suitable for risk-averse investments [3] Investment Strategy - Key focus on trading volume; if the first hour's trading volume exceeds 380 billion, the index may approach 3417 points; if it falls below 1.2 trillion, consider reducing positions to avoid potential pullbacks [4] - Long-term investors should consider semiconductor equipment, AI computing, and consumer electronics, which are at historical low valuations and have multiple policy catalysts [4] - Short-term traders should monitor hydrogen energy pilot projects and urban renewal themes, paying attention to the strength of leading stocks [4]

Core Viewpoint - The National Energy Administration has initiated a pilot program for hydrogen energy in the energy sector, aiming to promote innovative management models and explore diversified development paths for the hydrogen industry, supporting the entire "production-storage-transportation-application" chain of hydrogen energy [1][2]. Group 1: Pilot Forms - The pilot program consists of two forms: project pilots and regional pilots. Project pilots focus on promoting advanced hydrogen technologies and key equipment, while regional pilots aim to establish cross-departmental collaboration mechanisms and management models [4][6]. Group 2: Pilot Directions - The pilot directions encompass four major areas: hydrogen production, storage and transportation, application, and common support, with a total of 11 specific pilot directions [8]. Hydrogen Production - Direction 1: Large-scale hydrogen production and integration, requiring a minimum electrolyzer capacity of 100 MW or gasification capacity of 20,000 standard cubic meters per hour [9]. - Direction 2: Advanced flexible off-grid hydrogen production, with a minimum electrolyzer capacity of 10 MW [10]. - Direction 3: Comprehensive development of clean low-carbon hydrogen, with hydrogen purification capacity not less than 5,000 standard cubic meters per hour [11]. Hydrogen Storage and Transportation - Direction 1: Large-scale, long-distance transportation, with liquid hydrogen plant capacity not less than 5 tons per day and pipeline length not less than 100 kilometers [12]. - Direction 2: High-density, diversified storage, with a minimum storage capacity of 20,000 standard cubic meters per project [13]. Hydrogen Application - Direction 1: Green replacement in refining and coal-to-oil gas processes, with renewable hydrogen replacement scale not less than 1,000 tons per year [14]. - Direction 2: Hydrogen and ammonia fuel for power supply, with gas turbine projects not less than 10 MW and coal boiler projects not less than 300 MW [15]. - Direction 3: Long-duration hydrogen storage, with a minimum power generation capacity of 1 MW and continuous generation duration of not less than 4 hours [16]. - Direction 4: Comprehensive applications in the energy sector, with fuel cell installations not less than 0.5 MW [17]. Common Support - Direction 1: Hydrogen energy verification platforms for key equipment and hydrogen quality management [18]. - Direction 2: Low-carbon transition pilot projects focusing on renewable hydrogen production, storage, and multi-energy complementarity [19]. Group 3: Pilot Timeline - The pilot program is outlined in the notification issued by the National Energy Administration on June 4, 2025 [21].

Core Viewpoint - The article emphasizes the importance of advancing hydrogen energy development through a comprehensive approach that includes production, storage, transportation, and utilization, aiming to establish a clean, low-carbon, safe, and efficient energy system [3][4][5]. Group 1: Pilot Directions - Hydrogen production will focus on large-scale hydrogen generation and integration in areas rich in renewable resources, with a minimum electrolyzer capacity of 100 MW or gasification capacity of 20,000 standard cubic meters per hour [6]. - Advanced flexible off-grid hydrogen production will be explored in remote areas, with a minimum electrolyzer capacity of 10 MW [7]. - Clean and low-carbon hydrogen development will utilize by-product hydrogen from industrial processes and encourage carbon capture in fossil fuel hydrogen production, with a minimum hydrogen purification capacity of 5,000 standard cubic meters per hour [8]. Group 2: Hydrogen Storage and Transportation - Large-scale and long-distance hydrogen transportation will involve pipelines and liquid hydrogen tanks, with a liquid hydrogen plant capacity of no less than 5 tons per day and pipeline lengths of at least 100 kilometers [9]. - High-density and diversified hydrogen storage technologies will be tested, with a minimum storage capacity of 20,000 standard cubic meters per project [10]. Group 3: Hydrogen Applications - Renewable energy hydrogen production will replace traditional processes in refining and coal-to-oil gas production, with a minimum replacement scale of 1,000 tons per year [11]. - Hydrogen and ammonia fuel applications will support low-carbon transformation in power generation, with project scales of at least 10 MW for gas turbines and 300 MW for coal boilers [12]. - Hydrogen storage systems will be developed to support renewable energy integration, with a minimum capacity of 1 MW and continuous operation for at least 4 hours [12]. Group 4: Common Support - Establishing hydrogen energy verification platforms will support the validation of key hydrogen equipment and quality management [14]. - Low-carbon transformation pilots will focus on integrating renewable hydrogen production, storage, and multi-energy complementarity in various industrial settings [16]. Group 5: Implementation Organization - Each unit is required to organize pilot project applications based on local conditions, with a maximum of five projects recommended by provincial energy authorities [17]. - The application materials must be accurate and complete, showcasing the advantages and potential of the pilot projects [18]. - The National Energy Administration will guide the hydrogen energy pilot work and address practical issues during implementation [21].