Recently, it is reported that National Development and Reform Commission, Ministry of Environmental Protection and National Energy Administration jointly released Upgrading and Reconstruction Plan for Coal Power Energy Conservation and Emission Reduction (hereinafter referred to as the Plan), specifically deploying full implementation of energy strategic policy of “Saving, Clean and Safety” in coal power industry, accelerating upgrading and reconstruction, increasing high-efficient and clean development level. Insiders believe that the further improved requirements for gas pollutant emission will re-open the market of desulfurization, denitration and dedusting reconstruction for coal-fired generating set.
The Plan has clarified guidance ideology and action targets for developing upgrading and reconstruction of coal power energy conservation and emission reduction and formulated 30 target tasks in terms of strengthening access control of new units, accelerating upgrading and reconstruction of existing units, improving loading rate and operation quality of units, promoting technology innovation and integration application, improving supporting policy measures as well as carrying out task implementation and supervision.
According to the Plan, the average power-supply coal consumption of the new coal-fired generating sets will be less than 300g/kwh in China; by 2020, the average power-supply coal consumption of existing coal-fired generating units after reconstruction will be less than 310g/kwh, wherein that of the existing units of 0.6 million kw and above (except for air cooling units) after reconstruction will be lower than 300g/kwh. Under the premise of executing severer efficient environmental protection standards, ratio of coal in primary energy consumption will be reduced below 62% and ratio of electric coal in coal consumption will increase to more than 60% by 2020.
The Plan requires that ultra-supercritical units of 0.6 million kw and above should be adopted for new coal-fired generation projects and that power-supply coal consumption for 1 million clamminess and air cooling units cannot exceed 282 and 299g/kwh respectively and that for 0.6 million kw clamminess and air cooling units cannot exceed 285 and 302g/kwh respectively. The new units should be established with advanced high-efficient desulfurization, denitration and dedusting facilities at the same time. New units in eastern region reach the emission limit of gas turbine basically, that in central region is close to or reaches the above-mentioned limit in principle, and western region is encouraged to be close to or reach the above-mentioned limit. Meanwhile, eliminate-ion of regular small thermal power units of less than 50 thousand kw and below and other outdated capacities should be accelerated; close attention should be paid to comprehensive and systematic energy conservation reconstruction of subcritical and supercritical units of 0.3 million kw, 0.6million kw, etc; environmental protection reconstruction of gas pollutant emission concentration of the existing coal-fired generating units in eastern region should be promoted to make it reach the emission limit of gas turbine basically; energy conservation and emission reduction of self-provided units should also be strengthened.
Merchants Securities believes that improved requirements for gas pollutant emission will re-open the market of desulfurization, denitration and dedusting reconstruction of coal-fired generating units. According to requirements in Action Plan, it is necessary to install efficient desulfurization, denitration and dedusting facilities on coal-fired generating units. Reconstruction demonstration project of 8 million kw unit has been launched in 2014 to complete the reconstruction of unit capacity of more than 0.15 billion kw before 2020. Mature technology supports are necessary for desulfurization, denitration and dedusting to comply with the new environmental protection requirements.
Merchants Securities estimates that reconstruction demonstration project of 8 million kw unit is expected to bring early market totaling 2.16 billion, including 0.4 billion of dedusting reconstruction, 0.96 billion of desulfurization reconstruction, 0.8 billion of denitration reconstruction in 2014 on the basis of dedusting reconstruction of 0.5million/kw, desulfurization reconstruction of 1.2 million/kw, and “low-nitrogen combustion + SCR” denitration reconstruction of 1 million/kw, while by 2020, reconstruction of 0.15 billion kw unit will bring reconstruction market totaling 40.5 billion, including 7.5 billion of dedusting, 18 billion of desulfurization, 15 billion of denitraton estimated on the basis of reconstruction of 500,000/kw of dedusting, 1.2 million/kw of desulfuration and 1 million/kw of “low-nitrogen combustion + SCR”.
Except for the severer energy consumption and pollution control requirements, the Action Plan also gives guidance to energy conservation and emission reduction in system. Coal-fired generating units with gas pollutant emission concentration reaching or close to emission limit of gas turbine unit may obtain support of electricity price and all regions may formulate preferential tax policies as per their specific situations in the future. Economic profit can improve enthusiasm of electric power enterprises to reconstruct energy conservation, promoting real launching of reconstruction market.
The severer emission control standards put higher requirements on dedusting, desulfurization and denitration. According to research of Merchants Securities, FEIDA, LONGKING, China Power Investment, SPC, LONGYUAN and other atmospheric controlling companies have mastered technologies of reducing power-supply thermal coal consumption, zero-emission of gas pollutant and other new technologies, some of which have successful project experience, thus being given priority to enjoy benefits from launching of reconstruction demonstration project.
In re-construction market of 40.5 billion, atmospheric controlling companies with strong technologies and rich experience will expect increased market shares and will gain more benefit, while relatively smaller enterprises will enjoy more flexible performance. Therefore, Merchants Securities mainly recommends LONGYUAN enjoying benefits from both energy conservation and nitric oxide pollution control and also pollution controlling enterprises with strong technologies and able to realize zero-emission, such as FEIDA, LONGKING, China Power Investment, SPC.
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