According to the Zhitong Finance APP, Tianfeng Securities released a research report stating that since 2024, the overall supply and demand balance of China's power system has been maintained, but it still faces issues such as the misalignment of new energy generation and consumption areas, delays in the construction of transmission lines, energy storage, and peak-shaving power sources. In response, the investment amount of grid companies will remain at a high level for a period of time, with investments from the State Grid and Southern Grid expected to exceed 825 billion yuan in 2025, an increase of 220 billion yuan compared to 2024.
Faced with issues such as the misalignment of new energy generation and consumption areas, delays in the construction of transmission lines, energy storage, and peak-shaving power sources, capital expenditures for the grid will significantly accelerate in 2025. At the same time, it has been over two years since the first batch of renewable energy compliance lists was released, and previous policies have clearly stated that the subsidy gap will be addressed through special financing methods. Tianfeng Securities is optimistic about the accelerated resolution of subsidy arrears.
In terms of specific targets, it is recommended to pay attention to new energy operators such as Longyuan Power (001289.SZ), Datang New Energy (01798), Xintian Green Energy (00956), Three Gorges Energy (600905.SH), China Huadian New Energy (600930.SH), Jinko Technology (601778.SH), Envision Energy (601016.SH), Solar Energy (000591.SZ), and China General Nuclear Power New Energy (01811); thermal power transformation new energy operators such as China Resources Power (00836), Huaneng International (00902), and GDPD (600795.SH); and waste incineration power generation companies such as Hanlan Environment (600323.SH), Green Power (601330.SH), and Everbright Environment (00257).
The main points of Tianfeng Securities are as follows:
The State Grid and Southern Grid are responsible for large-scale grid construction tasks, such as ultra-high voltage projects, distribution network upgrades, and new energy consumption projects. Bond financing can quickly raise funds to alleviate the funding gap for project construction and ensure project progress. We have sorted out the historical bond issuance situation of the two grid companies and analyzed the differences in bond issuance for grid companies in 2025.
The scale of medium- and long-term bond issuance by the State Grid and Southern Grid in 2025 far exceeds historical levels
Since 2024, the overall supply and demand balance of China's power system has been maintained, but it still faces issues such as the misalignment of new energy generation and consumption areas, delays in the construction of transmission lines, energy storage, and peak-shaving power sources. In response, the investment amount of grid companies will remain at a high level for a period of time, with investments from the State Grid and Southern Grid expected to exceed 825 billion yuan in 2025, an increase of 220 billion yuan compared to 2024.
The bond issuance scale of the two grids has increased significantly, and the bond terms are generally longer. ① During the &#34;14th Five-Year Plan&#34; period (up to August 2025), the State Grid issued bonds totaling 14.6 trillion yuan, exceeding the combined total of the &#34;12th Five-Year Plan&#34; and &#34;13th Five-Year Plan.&#34; At the same time, the bond issuance scale of the State Grid from January to August 2025 (439.5 billion yuan) increased by 56% compared to the entire year of 2024, with the proportion of bonds with a term of 5 years or more reaching 51%, far exceeding historical levels. ② From 2002 to August 2025, Southern Grid has cumulatively issued 968.8 billion yuan in bonds, with a cumulative issuance of 406.3 billion yuan during the &#34;14th Five-Year Plan&#34; (up to August 2025). Meanwhile, the bond issuance scale of Southern Grid from January to August 2025 (92.9 billion yuan) is close to the entire year of 2024, with the issuance term of 10 years or more reaching 14 billion yuan
Financial Indicator Comparison: State Grid's Debt Ratio is Lower, Southern Grid's Profit Quality is Slightly Higher
The scale of grid assets has been accumulating year by year, with the State Grid and Southern Grid reaching asset scales of 5.96 trillion yuan and 1.39 trillion yuan respectively by the first half of 2025; during the same period, their asset-liability ratios were 54.2% and 60.6%.
Comparing the operational indicators of the two grids, in 2024, the State Grid's operating revenue and net profit were 39,193 billion yuan and 773 billion yuan, respectively, reaching 4.6 and 3.9 times that of the Southern Grid during the same period. However, from the perspective of profit quality, in 2024, the Southern Grid's ROA and ROE were 2.9% and 3.8%, both higher than the levels of the State Grid during the same period.
Both Grids Establish Settlement Companies to Address Subsidy Gaps through Special Financing
The issue of renewable energy subsidy gaps has become prominent, with the China Renewable Energy Society's Wind Energy Professional Committee estimating that by the end of 2021, the cumulative subsidy arrears amounted to approximately 400 billion yuan. In 2022, the National Development and Reform Commission, the Ministry of Finance, and the State-owned Assets Supervision and Administration Commission agreed to establish Beijing and Guangzhou Renewable Energy Development Settlement Service Co., Ltd. to coordinate the resolution of renewable energy generation subsidy issues. The subsidy funding gap will be addressed through special financing based on market principles, with the principal and interest of the special financing included in the budget of the Renewable Energy Development Fund.
Investment Recommendations
In the face of issues such as the misalignment of new energy generation and consumption areas, delays in the construction of transmission lines, and energy storage and peak-shaving power sources, capital expenditures for the grid are expected to accelerate significantly in 2025. Meanwhile, it has been over two years since the first batch of renewable energy compliance lists was published, and previous policies have clearly stated that the subsidy gap will be resolved through special financing. We are optimistic about the accelerated resolution of subsidy arrears. In terms of specific targets, we recommend paying attention to new energy operators such as CHINA LONGYUAN, Datang New Energy, Xintian Green Energy, Three Gorges Energy, China Huadian New Energy, Jinko Technology, Energy Saving Wind Power, Solar Energy, and China General Nuclear Power New Energy, as well as thermal power operators transitioning to new energy such as CHINA RES POWER, HPI, and GDPD, and waste incineration power generation companies like Hanlan Environment, Green Power, and Everbright Environment

600795

00836

600011

00902

001289

00916

Tianfeng Securities released a research report indicating that the investment in the State Grid and Southern Grid is expected to exceed 825 billion yuan in 2025, an increase of 220 billion yuan compared to 2024. Although the overall supply and demand of the Chinese power system is balanced, it still faces issues such as the misalignment of new energy generation and consumption areas, leading to accelerated capital expenditures for grid companies. Tianfeng Securities is optimistic about the resolution of subsidy arrears and recommends paying attention to several new energy and thermal power transformation enterprises

Zhitong

GDPD

CHINA RES POWER

HUANENG POWER

CHINA LONGYUAN

Tianfeng Securities: The issuance of medium- and long-term bonds by the two network companies will accelerate in 2025, optimistic about the accelerated resolution of subsidy arrears issues