New energy volume triggers new pain points The thermal power flexibility transformation market is poised for development

Financial Associated Press (Jinan, reporter Fang Yanbo) news, the rapid development of the new energy industry, so that China's power system peak regulation and consumption of the problem has become more prominent, thermal power flexibility transformation has become a hot spot in the capital market recently.

A senior thermal power industry person in Shandong told the Financial Associated Press that compared with pumped energy storage, electrochemical energy storage and other means, the flexibility transformation of thermal power units is the most ideal choice to improve the power supply and demand situation and promote new energy consumption. With the continuous advancement of the dual-carbon strategy, the market demand for thermal power flexibility transformation may be accelerated, and related enterprises are also expected to fully enjoy this wave of industrial dividends.

The flexible transformation market of thermal power is accelerating

Since 2021, the pace of China's energy structure transformation has accelerated, and new energy has developed explosively. According to the data, as of the end of November last year, the installed capacity of wind power photovoltaics in the country was 592 million kilowatts, an increase of 26.8% year-on-year. Among them, the installed capacity of wind power was 300 million kilowatts, an increase of 29% year-on-year; the installed capacity of photovoltaics was 290 million kilowatts, an increase of 24.1% year-on-year。 From January to November 2021, the total power generation capacity of wind power and photovoltaics in China increased by 34.7% year-on-year.

However, with the continuous expansion of new energy, new problems have also emerged.

An engineer of the State Grid Shandong Electric Power Company introduced to reporters that unlike the controllability of thermal power units, the output of wind power in windless conditions will be greatly reduced, and the output of photovoltaics will also plummet on cloudy days and at night, which leads to the output of wind and solar power not matching the electricity load; at the same time, because the installed capacity of wind and photovoltaic is mainly concentrated in the northwest, north China and other regions, there is also a spatial mismatch with the southeast region with high electricity load. Therefore, the consumption of new energy will be a problem worthy of attention at present and for a long time to come.

Huadian International (600027. SH) A relevant person in charge of a power plant said in an interview with reporters that the peak regulation capacity of the power system is the core to solve the new energy consumption, and the construction of the system peak regulation capacity has a variety of ways such as pumped storage, electrochemical energy storage, hydrogen energy storage and thermal power flexibility transformation, of which thermal power flexibility transformation has the advantages of high cost performance, short transformation cycle and significant effect, which is the most feasible solution under current conditions.

According to the research of CITIC Securities, the cost of the peak capacity of the flexible transformation of thermal power is only about 0.05 yuan, which has obvious advantages over other system adjustment means such as pumped storage, gas and electricity, and energy storage power stations.

At the same time, the flexible transformation of thermal power has also received strong support from the national policy level. In November last year, the National Development and Reform Commission and the National Energy Administration issued the "Notice on Carrying out the Transformation and Upgrading of National Coal-Fired Power Units", which clarified that during the 14th Five-Year Plan period, 200 million kilowatts of flexible transformation of existing coal-fired power units will be completed, the system adjustment capacity will be increased by 30-40 million kilowatts, and the flexible transformation scale of coal-fired power units will be realized by 150 million kilowatts。

Shanxi, Fujian, Shandong, Xinjiang, Ningxia, Guangdong, Gansu, Sichuan and other provinces have also successively issued relevant policies to encourage thermal power enterprises to accelerate the transformation of flexibility and participate in in-depth peak regulation.

According to the calculations of relevant institutions, the market size of thermal power flexibility transformation during the "14th Five-Year Plan" period alone will exceed 10 billion yuan, while the existing 1.29 billion kilowatts of thermal power units in China will have a market space of 100 billion yuan.

Listed companies accelerate their layout

Flexibility retrofit involves multiple subsystems within the power plant, and may require modification of the body of the unit equipment, as well as the addition of additional auxiliary equipment. At the same time, the technical means for the transformation of the units in different working links are not the same. As one of the few blue ocean markets in the traditional energy field, many listed companies are already eager to try.

Among them, Qingda Environmental Protection (688501. SH) participates in the flexible transformation market for thermal power units through its full-load denitrification system and clean energy consumption core system.

According to public information, the full-load denitrification system of Qingda Environmental Protection mainly reduces the heat absorption of the boiler economizer to the flue gas through the boiler economizer water-side adjustment technology, and ensures that the device is still at a normal working temperature under low load, so as to achieve the purpose of flexible peak regulation of thermal power generation units and low-load denitrification of boilers. Financial data show that in the first half of 2021, the company's full-load denitrification project achieved revenue of 54 million yuan, an increase of 248% year-on-year.

At the same time, the company's clean energy consumption system converts electrical energy into thermal energy storage and supply through the electrode boiler system and the heat accumulator system to achieve flexible peak shaving and clean energy consumption of thermal generating units. According to the company's strategic planning, the company will continue to invest 38.44 million yuan to build a heat accumulator product production line to provide the production capacity of the company's heat accumulator products.

The leading leading gas turbine boiler Hang Pot Shares (002534. SZ) has also entered the thermal power flexibility transformation market through mergers and acquisitions. In November 2021, the company announced that it intends to acquire 51% of the shares of Hepu Energy through the transfer of shares and capital increase, and the final transaction price will not exceed 1.53 billion yuan.

The relevant person in charge of the company told reporters that Hepu Energy has a first-mover advantage in the field of deep peak shaving of thermal power, and has relevant patented technologies, and through this transaction, the company can quickly enter the huge market of flexibility transformation of thermal power enterprises and become a new profit growth point for the company.

In addition, Longyuan Technology (300105. SZ) also has a place in the thermal power flexible transformation market with many years of deep cultivation in the field of coal-fired boiler technology.

The company said that the company has been carrying out business related to the transformation of thermal power flexibility on the boiler side, such as combustion system transformation, milling system transformation, heating surface transformation, etc. Financial data show that Longyuan Technology's low-nitrogen combustion business in the first half of 2021 achieved revenue of 57 million yuan, an increase of 172.95% year-on-year, and operating profit of 0.09 billion yuan, an increase of 200% year-on-year.