On September 7, 2021, the pilot launch meeting of green power trading will be held in Beijing.

The national green electricity trading pilot project was officially launched. 1) this is the first green power transaction launched after the National Development and Reform Commission and the Energy Bureau approved the "Green Power Trading pilot work Plan". A total of 259 market players from 17 provinces participated and reached 7.935 billion kilowatt-hours of trading capacity. Among them, the State Grid Corporation traded 6.898 billion kilowatt hours in the operating area and 1.037 billion kilowatt hours in the operating area of the Southern Power Grid Company. The deal is expected to reduce the burning of standard coal by 2.436 million tons and carbon dioxide emissions by 6.0718 million tons. 2) in our previous industry report carbon Neutralization: the Breakthrough War for New Energy operators, we mentioned that the existing pilot green power trading is not active, the overall listing trading rate and trading volume are very low, and there is a lack of national systematic trading rules. The launch of the national green power trading pilot indicates that the market mechanism of green electricity trading in China will be gradually improved and the new mode of green electricity consumption will be opened in an all-round way.

The environmental value of green power will be fully reflected through the market mechanism. On the one hand, the significance of carrying out green power transaction is that it can replace government subsidy through market mechanism, comprehensively reflect the electric energy value and environmental value of green power, enhance the power generation income of green power products, and enhance the competitiveness of green power in the market. effectively promote the development of new energy and promote the realization of the goal of "double carbon" in China. On the other hand, it can provide a convenient and feasible way for power users to purchase green electricity and achieve zero-carbon demand for products, effectively meet users' willingness to consume green electricity, and form a good demonstration effect.

The subsequent green power transaction will gradually expand to other renewable energy sources. In the initial stage of the pilot, green power products are the online power of wind power and photovoltaic power generation projects, and will be gradually expanded to other renewable energy sources in the follow-up. The green power trading system has been improved, and new energy operators such as wind power, photovoltaic and waste incineration have benefited in an all-round way.

Investment advice:

With the gradual implementation of carbon neutralization supporting policies, the electricity price system and new energy subsidy model will be changed, and the profitability and cash flow level of new energy operators such as waste incineration and wind power photovoltaic will be significantly improved. the industry is expected to usher in the opportunity of revaluation. 1) waste incineration: the waste incineration industry will also benefit from the improvement of the green card trading system, which is a long-term trend in the future. Recommend waste incineration leader Sanfeng environment, Han blue environment, Everbright environment, green power, high-energy environment, Weiming environmental protection and Shanghai environment. 2) New energy power generation: cheap access to the Internet will lead to a more reasonable layout of the industry, while the green card is expected to bring additional benefits for parity projects. Recommend national wind power operators with large installed scale and rich project resources, such as China Longyuan Power Group Corporation, Datang New Energy, Zhongguang Nuclear New Energy and A-share wind power operation leader energy-saving wind power, to benefit the target China and Fujian Energy. Recommended growth certainty and high dividend H-share photovoltaic operator Xinyi Energy and A-share photovoltaic operation leader solar energy, Jingke technology.

Risk hint

The progress or operation of the project is lower than expected, changes in subsidy policy, etc.