For thermal power enterprises in the midst of low-carbon transformation, they are not only the main body of power supply but also the pioneers of low-carbon transformation. On May 30th, the reporter of "China Energy News" learned at the press conference of the "Performance Evaluation Report on Low-Carbon Transformation of Chinese Thermal Power Listed Companies under the Carbon Neutrality Goal 2022" (hereinafter referred to as the "Report") (hereinafter referred to as the "press conference") that in the more than two years since the "dual carbon" goal was proposed, under multiple pressures such as rising coal prices, intensified marketization, frequent extreme weather, and peak-time supply guarantee, the low-carbon transformation processes of different thermal power enterprises have shown differentiation. Meanwhile, thermal power is related to the carbon peak and carbon neutrality of multiple industries and requires support from multiple levels of policies and mechanisms.
■■ Thermal Power is the Most Critical Industry in Low-Carbon Transformation
Zhang Jieqing, the chief representative and director of the Beijing Office of the Natural Resources Defense Council, pointed out at the meeting that the most critical behavior causing carbon emissions is human energy activities, especially the consumption of fossil energy in the power sector.
In March 2022, the "Synthesis Report" of the Sixth Assessment Report released by the Intergovernmental Panel on Climate Change of the United Nations pointed out that in the past century, the combustion of fossil fuels, along with unequal and unsustainable energy and land use, has led to a continuous rise in global temperatures, which is currently 1.1 degrees Celsius higher than the pre-industrial level. "According to the data recently released by the International Energy Agency, in 2022, the carbon emissions growth of the world's largest industries still came from the supply of electricity and heat, and electricity is also the largest carbon emission sector in China. Although the growth of carbon emissions in the power industry slowed down in 2022, it still rose by 2.6% year-on-year. Facing the severe situation of climate change, the task of low-carbon transformation in the power industry is arduous and urgent," Zhang Jieqing pointed out.
For China, thermal power plays a pivotal role in the development of the social economy. Ma Jun, the director of the Public Environmental Research Center, analyzed that in the era of fossil energy, due to China's energy endowment of being rich in coal, poor in oil, and lacking in gas, thermal power dominated by coal power has long been the absolute main force of China's power energy.
"But while promoting the development of the social economy, the emissions from thermal power dominated by coal power have also become an important source of air pollution. Especially since the beginning of the 21st century, the huge growth rate of the economic volume has led to a sharp increase in China's coal consumption. In 2009, in industrial pollution emissions, the power industry accounted for 65% of the total nitrogen oxide emissions; 55% of the sulfur dioxide emissions; and about 40% of the industrial soot emissions," Ma Jun believes that in the process of building a clean, low-carbon, safe and efficient modern energy management system, the low-carbon transformation of the thermal power industry is also related to the carbon peak and carbon neutrality of many industries such as steel, nonferrous metals, chemicals, transportation, etc., and its progress is related to the overall "dual carbon" process of China.
■■ Listed Companies in Thermal Power Show Their Skills in Low-Carbon Transformation
As the main force of China's coal-fired power installations, listed thermal power companies need to play a leading and exemplary role in low-carbon transformation.
It is understood that the "Report" selected 31 listed thermal power companies with a thermal power asset installed capacity ratio higher than 30% (that is, the installed capacity of thermal power units of the company accounts for more than 30% of the total installed capacity of the company) as evaluation objects, including Huaneng International, Datang Power Generation, Huadian International, Guodian Power, China Power, Shanghai Electric Power, SDIC Power, China Resources Power, Shenzhen Energy, Shenergy Co., Ltd., etc., focusing on the comprehensive performance evaluation of low-carbon transformation during the "13th Five-Year Plan", the low-carbon planning for the "14th Five-Year Plan" and the longer term, and the comprehensive performance evaluation of the annual progress of the "14th Five-Year Plan".
The "Report" shows that among the top 10 of the comprehensive performance ranking of low-carbon transformation of listed thermal power companies during the "13th Five-Year Plan", 6 are listed companies controlled by the five major power generation groups, namely Jilin Electric Power Co., Ltd., Shanghai Electric Power, Huadian International, Datang Power Generation, China Power and Huaneng International. From the perspective of the planned installed capacity of new energy during the "14th Five-Year Plan", Huaneng International plans to add the largest installed capacity of new energy, followed by Huadian International. In the longer-term planning commitment, China Power and Jingneng Power have proposed clear plans for adding new energy installed capacity, which are to reach 75% and 50% of clean energy installed capacity by 2035 respectively.
The reporter sorted out and found that the low-carbon transformation paths of listed thermal power companies are not unique, and different companies carry out differentiated transformations based on their existing advantages. Among the highly rated listed thermal power companies, outstanding enterprises have different characteristics and each has its own distinct "label".
For example, Jilin Electric Power Co., Ltd., which ranked first in the comprehensive performance ranking of low-carbon transformation during the "13th Five-Year Plan", its label is "active transformation". During the "13th Five-Year Plan" period, the company has completed the transformation from a thermal power listed company to a comprehensive energy supplier and began to layout new energy businesses outside the province since 2012. By the end of 2020, the proportion of new energy was 63.85%; the total profit of the new energy sector in 2020 reached 14 times that of 2015, and the project locations cover 30 provinces, cities and autonomous regions across the country. In addition, Jilin Electric Power Co., Ltd. focuses on new energy, comprehensive smart energy, hydrogen energy, energy storage and charging and swapping industries. In 2022, it invested in the establishment of Shanghai Jidian Jiling New Energy Co., Ltd. and actively explored the "green power off-grid" business model.
The label of Guodian Power is "focusing on thermal power", fully tapping the transformation space and capacity of existing thermal power units. In terms of thermal power transformation, in recent years, multi-dimensional technological transformations such as comprehensive boiler upgrade transformation, steam turbine through-flow transformation, energy-saving upgrade transformation, and efficient centralized heating have been implemented on existing thermal power units to improve the operating efficiency of the units. Guodian Power's assets are distributed in 28 provinces, cities and autonomous regions across the country, mainly concentrated in the eastern coastal areas, large-scale coal-fired power bases and external power transmission channels. Combining the competitive advantages of different regions, it promotes the layout of "base-style, station-style, and distributed" wind power and photovoltaic projects respectively.
■■ Thermal Power Faces Pressures in Accelerating the Transformation Pace
The experts attending the meeting believe that thermal power faces multiple challenges in the process of low-carbon transformation. Zhang Weidong, the director of the Planning Division of the Planning and Finance Department of the China Electricity Council, pointed out that in the process of change and development, there are always situations where the supporting policies and market mechanisms are not fully adapted. "Sometimes the technology is ready and the awareness is there, but the market mechanism is not; sometimes the market environment is there, but the technology is not quite satisfactory. Although thermal power is a relatively long-standing power generation industry in electricity, it still faces various challenges such as the 'three reforms and linkages', the encouragement of market policy mechanisms, the continuous improvement of technology, and the improvement of policies, all of which still require time.
"In the future power system, thermal power should play the role of auxiliary peak shaving." Yuan Jiahai, a professor at the School of Economics and Management of North China Electric Power University, took Sichuan as an example and pointed out the issues that need to be considered in the future transformation of thermal power. "Sichuan can be understood as a pioneer province of a high-proportion new energy power system. In fact, the installed capacity and power generation of hydropower account for about 85%. Coal power plays an auxiliary role. This is precisely the main role that coal power will undertake in 2050 and 2060," Yuan Jiahai believes that it is necessary to accelerate market reforms, promote the transformation of coal power to the new role faster and better, and provide it with the necessary support of policies and mechanisms.
From the perspective of coal and power integration, Zhang Weidong suggested that it can be combined through two approaches in form. "The first is direct integration in technology and the industrial chain, such as Mengdong Yimin Power Plant and the pithead power plant of Shaanxi Coal. The coal mined from the coal mine is directly transported to the power plant by belt for crushing and power generation. The amount of coal produced is based on the amount of power to be generated. The second is unified coal and power integration through assets. The advantage of this model is that it can coordinate coal production, coal consumption, and power generation. For example, price management and contract agreements will be more convenient."
In addition, in recent years, the coverage and support objects of transition finance have targeted high-carbon emission industries, and have also become boosters in the process of achieving low-carbon transformation in high-carbon emission industries. Ma Jun pointed out that China has its own energy endowment. In the direction of transformation, efforts should be made in the direction of transition finance. "In transition finance, coal is a particularly critical part. Today, the coal power industry is facing difficulties, coupled with the pressures of transformation, supply guarantee, peak shaving, and a large number of flexible transformation. How to ensure the enthusiasm of the thermal power industry for transformation requires corresponding standards in terms of policy inclination, market incentives, recognition of financial institutions, etc."
