Dear Shareholders,


2017 is a year of stability for China Power Clean Energy in all aspects of its work. We always abide by the mission of a listed company and earnestly fulfill our promises to create value for shareholders and create clean energy for the society. In the past year, the Group was committed to its principal business, actively responded to the new norms of economic development, new trends in energy reform, new strategies of the Group’s development and other changes. We prevailed over the power tariff reduction for renewable energy, inflating fuel prices and increasingly stiff market competition. We stuck to safety production strictly, and maintained stable operating results.

BUSINESS REVIEW FOR 2017

Sustained stability in operating results

2017 saw China Power Clean Energy maintain its stable development. During the year, China Power Clean Energy recorded profit attributable to equity holders of the Company of approximately RMB401,702,000, representing a year-on-year decrease of 0.7%. Amidst multiple uncertainties, the Company managed to make profits in all five segments, namely natural gas, waste-to-energy power generation, wind power, photovoltaic power and hydropower. Net profit of the Company remained stable, mainly owing to an improving picture in the percentage of wind and photovoltaic power curtailment. During the year, the Company generated 9,940,496.33 MWh of electricity.

Continuously optimised industrial layout

During the year, the Group continued to increase the proportion of its waste-to-energy power generation and natural gas power generation projects, with the industrial layout optimised on an ongoing basis. In 2017, the Group had a controlled installed capacity of 3,903.43MW and an additional installed capacity of 170.7MW. In particular, Anhui Wuhu Waste-to-energy Power Project (with an installed capacity of 24.0MW) is the first of its kind undertaken by China Power Clean Energy in East China; and operation also commenced as planned in photovoltaic power projects such as Fujian Zhangpu Project (with an installed capacity of 80.0MW) and Macheng Wind Power Project (with an installed capacity of 80.0MW). In 2017, the Group also obtained approval for multiple projects relating to waste-to-energy power generation as well as photovoltaic and wind power generation. Such approved projects are Phase II of Anhui Wuhu Project, Liaoning Beizhen Project, Henan Shangqiu Project, Hainan Qionghai Project and Phase III of Haikou Waste-to-energy Power Project. The Group received the reply on thermal power joint production from Jiangsu Energy Administration in respect of Jiangsu Lianshui Thermal Power Joint Production Project; and the Group received the reply on the planning of thermal power joint production from Dezhou municipal authorities in respect of Shandong Dezhou Natural Gas Project. At the same time, the Group has made steady progress in project engineering quality, obtaining the “2017 China Power Quality Project Award” (2017年度中國電力優質工程獎) and the “2016–2017 National Quality Project Award” (2016–2017年度 國家優質工程獎) for the Phase II Expansion Project of Dongguan Natural Gas Project for Thermal Power Joint Production. The Company also won the 2017 “Green Energy Innovation Award”, an award conferred by CFEID, for its wind power project in Germany.

In 2017, with the strong support of all shareholders and the joint efforts of all staff, China Power Clean Energy delivered stable performance and completed most of its works. I would like to express my sincere gratitude to the shareholders on behalf of the Board and all the officers and staff!

PROSPECT FOR OPERATIONS IN 2018

China will push for high-quality development in 2018. On one hand, as China embraced its “New Normal” in economic development, national authorities will strenuously reform energy production and consumption. Favorable policies will steer the development of the new energy industry to a positive direction. On the other hand, there will be a decline in electricity tariffs for new energy, due to lower costs for power generation from new energy and less government subsidy and support for new energy. Overall, the “13th Five-Year Plan” has brought both challenges and opportunities to the new energy industry, with higher development quality to become a necessity. We will take into account macro-economic changes and pay close attention to the changes to main contradictions in the Chinese society. We will comply with the requirement of high-quality development, and stick to the supply-side structural reform as the underlying principle. On top of that and with reference to the development requirement of building a “World-class Enterprise”, the Group will work harder on acquiring new energy resources, continue to optimise its industrial layout and deliver economies of scale in its region. We will also be engaged in greater development of wasteto- energy power projects and natural gas power projects, look for opportunities to develop integrated smart energy projects in emerging industrial parks, prioritise the development of reserve projects for wind and photovoltaic power generation in well-off areas and those with no wind and photovoltaic curtailment. We will enhance our safety production, project construction and other areas of basic management in an all-round manner, work on team building and staff capability development, and continue to improve our operation, management and asset quality.

I firmly believe that all of the Company’s management and staff will adhere to the core value of “innovation and creation, continuous endeavor and harmonious coexistence” and the entrepreneurial spirit of “green innovation and deployment”, and continue to return outstanding achievements to shareholders and the society.