Core Insights - The State-owned Assets Supervision and Administration Commission (SASAC) has called for stabilizing electricity and coal prices to prevent excessive competition in the power industry, marking the first mention of "anti-involution" in this sector [1] - The power sector performed well in the first week after the National Day holiday, with companies like Huaneng International and Huadian International seeing stock price increases of over 3% [1] - Q3 earnings growth for thermal power companies is expected to continue, with projections ranging from 30% to 80% [1] Group 1: Electricity Pricing and Market Dynamics - During the National Day holiday, the minimum electricity price performed better than in previous years, with only one day of negative pricing in Shandong over the eight-day period, compared to five days of negative pricing last year [2] - The increase in electricity demand from the hospitality, catering, and entertainment sectors has countered the decline in industrial load, challenging previous assumptions about holiday electricity consumption [2] Group 2: Carbon Reduction and Technology - The maturity of CCUS technology is acknowledged, although its energy consumption and costs remain high, with potential CO2 storage capacity estimated between 50 million to 100 million tons annually [3] - Co-firing biomass technology is recognized as mature but faces limitations due to resource availability and logistical challenges [3] - Initial engineering validation of coal and ammonia co-firing has been conducted, achieving a co-firing ratio of 25% to 35%, with expectations for a 50% reduction in carbon emissions from coal power in the long term [3] Group 3: Hydropower Performance - Hydropower companies are expected to report strong Q3 results, with Qianyuan Power projecting a net profit increase of 70% to 100% due to favorable water conditions [4] - Guikang Power's hydropower generation increased by 21.9% year-on-year, while the Three Gorges Group reported a 71.4% increase in total generation during the holiday period [4]

Investment Rating - The report indicates a positive outlook for the power sector, with thermal power companies expected to see growth rates between 30-80% in Q3 [5][8]. Core Insights - The State-owned Assets Supervision and Administration Commission (SASAC) has emphasized stabilizing electricity and coal prices to prevent vicious competition, leading to a positive performance in the power sector post-holiday [5][6]. - During the National Day holiday, the lowest electricity prices were better than previous years, attributed to increased demand from the service industry, which offset declines in industrial load [6][8]. - Hydropower performance in Q3 is expected to be strong due to favorable water conditions, with companies like Guizhou Qianyuan Power and Guangxi Guiguan Electric Power reporting significant profit increases [8]. Summary by Sections Electricity and Coal Prices - The report highlights the stabilization of electricity and coal prices, which has positively impacted the power sector's performance [5][6]. Thermal Power Growth - Thermal power companies are projected to experience growth rates of 30-80% in Q3, with traditional leaders performing well [5][8]. National Day Performance - The report notes that during the National Day holiday, only one day had negative spot prices in Shandong, indicating a surge in electricity demand from the service sector [6][8]. Hydropower Performance - Companies like Guizhou Qianyuan Power and Guangxi Guiguan Electric Power are expected to report significant profit increases due to favorable water conditions, with Guizhou Qianyuan Power projecting a net profit increase of 70-100% [8].