At the end of the third quarter, electricity growth will fall back to about 10%

In August 2010, the electricity consumption of the entire society was 397.5 billion kWh, a year-on-year increase of 14.7%, a slight rebound from the 13.9% growth in July, and a 2.0% increase from the previous month; the cumulative electricity consumption in January-August was 2.7949 trillion yuan. , an increase of 19.3% year-on-year, and the cumulative growth rate fell below 20% for the first time.

This month's data is slightly better than our previous judgment of 388 billion kilowatt-hours in August and 2776.9 billion kilowatt-hours in 1-8. We believe that the characteristics of the demand side for electricity use in August are: The increase in electricity consumption by the tertiary industry and the residents is relatively large, which has played a supporting role in the slight increase in the power demand. Affected by various macro-control policies, the growth rate of industrial electricity continued to decline. Excluding seasonal factors, we believe that the growth rate of electricity usage at the end of the third quarter will fall to around 10%.

In August, the industrial electricity consumption was 283.3 billion kWh, a year-on-year increase of 14.7%, which was a drop from the 15.3% growth rate in July. Of particular concern is that the demand for industrial electricity demand in August was only 71.1% of the total electricity demand of the entire society, a sharp drop of 8.2 percentage points from June, the lowest point in the year. It shows that the impact of macro-control policies has begun to deepen, and the pressure on energy-saving and emission reduction in the 11th Five-Year period has suddenly increased with time, and major energy-intensive industries have recently emerged as a result of sudden power cuts and production cuts. This is basically consistent with our previous judgment, that is, the end of the third quarter will be the time window for macroeconomic control policies have an in-depth impact on electricity demand.

It should be noted that the electricity demand of the whole society rebounded slightly month-on-month, which is a departure from the July-August period of 2007-2009. We believe that the significant increase in the electricity consumption of the tertiary industry and residents is the main factor in the year-on-year comparison. The contribution of the two industries to the demand for electricity in August was as high as 25.7%, which was the highest in the year.

Based on an analysis at the industry level, we still maintain a “neutral” investment rating for the power industry as a whole. However, due to the improvement of the water supply situation, it will obviously benefit the production of hydropower companies. In the third quarter, hydropower will usher in the best opportunity for the year. Therefore, we upgrade our rating on the water electronics industry to “overweight”.

We believe that hydropower companies in Yunnan, Guizhou, and Guangxi in the first half of the year may be affected by droughts. Hydropower companies in Sichuan and Hubei will also be affected to a certain extent. Therefore, we recommend that the first half of the year be affected by drought. Severe, and in the third quarter, the water supply situation is expected to be significantly improved in the region's hydropower companies, such as Yangtze Power, Wuyuan Power, Wenshan Power, and Xichang Power. In addition, attention can be paid to star power of its own power grid. Secondly, we recommend thermal power companies with power environmental protection businesses such as Jiulong Power, Shenzhen Energy, etc.