The principal activities of the Group at present are the development, construction, owning and management of clean energy power plants in China, including but not limited to wind power generation, hydropower generation, natural gas power generation, photovoltaic power generation, waste-to-energy power generation and other clean energy power generation projects. As of 31 December 2018, the number of power generation plants owned or controlled by the Group within China has reached 41, which are scattered in 23 provinces, including Guangdong, Fujian, Gansu, Jiangsu and Chongqing, etc., and the electricity generated therefrom is sold to Southern Power Grid, East China Power Grid, Northeast Power Grid and Northwest Power Grid.


For the year ended 31 December 2018, the Group recorded a revenue of approximately RMB4,808,703,000 (y ea r ended 31 December 2 017: appro xima t e l y RMB4,820,975,000). The Group’s profit for the year was approximately RMB186,101,000 (year ended 31 December 2017: approximately RMB403,846,000) and the Group recorded profit attributable to owners of the Company of approximately RMB185,323,000 (year ended 31 December 2017: approximately RMB401,702,000). Basic and diluted earnings per share amounted to approximately RMB0.1562 (year ended 31 December 2017: approximately RMB0.3385).

On 23 July 2018, the Company received a letter from SPIC informing the Company that, having regard to the time that elapsed as from the signing of the memorandum of understanding on 30 December 2015, SPIC considered there to be material uncertainty as to the obtaining of governmental and regulatory approvals in the PRC for the Possible Transaction and the related internal reorganization of the SPIC Group, and SPIC has therefore decided not to proceed with the Possible Transaction. Accordingly, the offer period in relation to the Possible Transaction, which commenced on 8 January 2016, closed on 23 July 2018.


The installed power capacity of clean energy in China has continued to grow in 2018. There was faster growth in the power generation from new energy sources such as photovoltaic, wind and biomass power, with a significant improvement in wind and photovoltaic curtailment. In certain provinces, zero curtailment rates of wind and photovoltaic power were recorded. During the year, the installed power generation capacity of clean energy was 1.87 trillion kWh, which accounted for 26.7% of the total power generation, representing a year-on-year increase of 0.2 percentage points. With regard to the power supply structure, the energy structure will gain an increasing proportion in green and clean energy. In the future, the proportion of hydropower, wind power, photovoltaic power and gas power generation will continue to increase.

Stepping into the third year of the “13th Five-Year Plan” with respect to power development, China’s power system reform continued to develop into multiple business models. China enhanced the competitive allocation mechanism for new energy projects, optimised the construction distribution of wind and photovoltaic power generation, promoted the grid parity of renewable energy such as wind and photovoltaic power, supported the development of distributed wind and photovoltaic power and continued to reinforce the initiatives for renewable energy consumption, all of which yielded significant results. In 2018, there was a continued growth in the traded power volume in the national electricity market, with the traded volume amounting to 2,065.4 billion kWh, representing a year-on-year increase of 26.5%. This helped to notably relieve the wind and photovoltaic curtailment within China. The national average wind curtailment rate was 7%, representing a year-on-year decrease of 5 percentage points; average photovoltaic curtailment rate was 3%, representing a year-on-year decrease of 2.8 percentage points.

Guided by the “13th Five-Year Plan”, the scale of the installed power generation capacity for renewable energy nationwide has steadily expanded. In 2018, additional installed power generation capacity for renewable energy amounted to 83.11 million kW, which accounted for 67% of the total additional installed power generation capacity. On the other hand, the country will continue to develop its national carbon emission trading market, and implement the protective buyouts and green certificate systems. Besides, the country launched parity grid demonstration for wind power and continued to promote its regional power market reform, which resulted in a further increase in discount to profits. By 2020, China is expected to fully activate its electricity spot market mechanism, creating sufficient competition among market players on the side of electricity sales. In the next few years, China’s demand for electricity will maintain a recovering upward momentum, with power supply and demand to remain largely stable.

According to the data from the National Energy Administration, in 2018, national power consumption was 6,844.9 billion kWh, representing an increase of 8.5% year on year. Specifically, the hydropower, wind power and photovoltaic power accounted for 1.2 trillion kWh, 366 billion kWh and 177.5 billion kWh respectively, representing a year-on-year increase of 3.2%, 20% and 50% respectively; and biomass power accounted for 90.6 billion kWh, representing a yearon- year increase of 14%. The total capacity of national power generation equipment amounted to 1,899.67 million kW, representing a year-on-year increase of 6.5%. Specifically, the total capacity of grid-connected wind power amounted to 184.26 million kW, representing a year-on-year increase of 12.4%; and the total capacity of grid-connected photovoltaic power amounted to 174.63 million kW, representing a year-on-year increase of 33.9%. During the year, national average utilisation amounted to 3,862 hours, increasing by 73 hours year-on-year. Specifically, the average utilisation of thermal power, wind power and hydropower were 4,361 hours, 2,095 hours and 3,613 hours, representing a year-on-year increase of 143 hours, 147 hours and 16 hours respectively. In 2018, the national installed capacity of thermal power, hydropower, wind power and photovoltaic power were approximately 1,140 million kW, 350 million kW, 180 million kW and 170 million kW, respectively.


Steady rise in power generation

In 2018, the Group’s power generation was 10,135,282.52MWh, representing an increase of 1.96% as compared with the same period last year. Such increase was primarily attributable to (i) the year-on-year increase in annual power generation of the wind power segment of 27.19% resulted from the good wind conditions of the wind power segment and the significant drop in wind power curtailment rate; (ii) the yearon- year increase in annual power generation of the wasteto- energy segment of 50.74% due to the full year operation of Anhui Wuhu Project and the commencement of operation of Guizhou Guiyang Project in February; and (iii) the increase in annual power generation of the photovoltaic power segment of 15.09% due to the commencement of operation of the additional capacity of Zhejiang Yunhe Project and the decrease in loss from photovoltaic power curtailment. Although (i) there was a year-on-year decrease in annual power generation of the hydropower segment of 27.92% due to the decrease in water flow volume in Fujian area; and (ii) there was a yearon- year decrease in annual power generation of Guangdong Dongguan Project of 4.36% due to the “West-to-East Power Transmission” and the decrease in natural gas supply, considering all the factors above, the power generation of 2018 was still on the rise.

Decrease in operating results

In 2018, the Group’s profit attributable to owners of the Company was approximately RMB185,323,000, representing a decrease of 53.9% compared to the same period last year. Such decrease was primarily attributable to: (i) the drop in natural gas tariff; (ii) the rise in unit price of natural gas resulting in the increase in production costs of natural gas projects; and (iii) the decrease in power generation resulted from the significant decrease in rainfall in Fujian where the hydropower projects are located.

On the other hand, the Company achieved a better performance in actively striving for a larger share of power generation in the market and lowering the wind and photovoltaic power curtailment rate, which enhanced the profitability of wind and photovoltaic power generation. In 2018, the Company accounted for 42% of the power generation in the market, representing a year-on-year increase of 10 percentage points. The accumulated curtailment rates of wind and photovoltaic power were 20.4% and 1.1%, representing a year-on-year decrease of 11.6 percentage points and 3 percentage points, respectively.

Promoted projects development

The Group innovated a project development model which enables it to identify the development priorities and tracking projects. During the year, the Group obtained franchise rights for Tai’erzhuang, Huanggang, Huangmei, Wenchang and Keshan County Environmental Power Projects, and development rights for Phase II of Chunyangshan and Anhui Huaining Lashu Wind Power Projects. Jiangsu Xiangshui Wind Power Project has been included in 2018 Wind Power Development and Construction Plan by Jiangsu Development and Reform Commission. Shandong Dezhou Natural Gas Thermal Power Joint Production Project, Hongze Sanhe Natural Gas Distributed Energy Project, Tai’erzhuang Environmental Power Project, Jilin Panshi Environmental Power Project and Hebei Handan Yongnian Environmental Power Project were approved, which had a total approved capacity of 369.0MW.

Well managed construction in progress

As of 31 December 2018, the Group has 13 projects under construction, which comprised 1 natural gas power project, 9 waste-to-energy power projects, 1 wind power project, 1 biomass power project and 1 coal power project. During the year, Guiyang Environmental Power Project and Yunhe Photovoltaic Power Project commenced operation, which had a total capacity of 31.76MW. In strict accordance with the requirements of “regulation of quality standards, visualization of handover and refinement of operation process”, the Group organised and conducted specialised inspections for mass concrete pouring quality and quality supervision at key nodes. The Group also strengthened its engineering process management and steadily promoted the construction process. In 2018, we obtained the “2018 China Power Quality Project Award” (2018年度中國電力優質工程獎) for the Wu Hu China Power Environmental Power Project.

As of 31 December 2018, the Group’s projects under construction had an installed capacity of 772.0MW.

Stable and safe production

In 2018, the Group promoted its implementation of safe production, and compiled a list of safe production accountability system covering all positions, resulting in a further implementation of the safe production accountability system. The Group organised and conducted assessments related to production safety. To strengthen the all-round supervision, a project safety management support system has been fully implemented for the infrastructure unit. The Group reinforced its supervision and management for tendering, admission and licensing of the contractors. Besides, the Group also stepped up its efforts in investigation and management of hidden dangers, strengthen safety education and training, implemented the safe production accountability system, and prevented safety accidents through various safety precautions. During the year, the safety conditions of infrastructure and production were stable and under control.