Shenyang Huitian Thermal Power Co.,Ltd

Expanding thermal power capacity through large-scale projects, as seen with peers like Jingneng Power's RMB 5 billion private placement for thermal expansion, can secure long-term contracted revenue streams and improve operational scale efficiency, supporting stable earnings growth over the next year.

Heavy capital expenditure on thermal power expansion carries significant financial risk, with long payback periods exceeding eight years and relatively modest internal rates of return around 11%, raising concerns about near-term return on invested capital and increased debt burden for Shenyang Huitian.

Despite modest price declines, thermal power operators maintaining stable grid-connected output volumes can offset per-unit revenue compression through higher dispatch rates and cost controls, allowing companies like Shenyang Huitian to preserve overall revenue levels in the coming year.

The average on-grid electricity price (excluding tax) fell 2.70% year-over-year to RMB 0.41 per kWh in the first half of 2026, reflecting structural pricing headwinds in the thermal sector that could persistently compress Shenyang Huitian's margins and earnings through the next fiscal year.

Thermal power assets retain critical grid-balancing and peak-load roles as China accelerates renewable energy deployment. Integrated wind-solar-thermal-storage projects pursued by sector peers highlight thermal operators' enduring strategic relevance, potentially benefiting Shenyang Huitian's utilization rates and policy support.

The accelerating shift toward large-scale renewable energy bases, exemplified by peers developing 1,500 MW integrated wind-solar-thermal-storage projects, signals a structural decline in pure thermal power's market share, threatening Shenyang Huitian's long-term dispatch volumes and competitive positioning.