The Zhitong Finance App learned that Haitong International released a research report saying that on January 12, the State Grid held a 2024 work conference, and power grid investment is expected to continue to increase in 2024, which will exceed 500 billion yuan. From January to November 2023, China's grid investment scale was 445.8 billion yuan, up 5.9% year on year. Of these, the investment scale in November was 24.9 billion yuan, up 13.2% year on year. The acceleration trend of China's power grid investment is very obvious. It is expected that the full year of 2023 investment will exceed 520 billion yuan, an increase of more than 2% year on year. Power grid investment will continue to be booming in 2024. It is recommended to focus on primary and secondary power equipment companies such as “Guodian Nanrui” (600406.SH), “Pinggao Electric” (600312.SH), and “China Xidian” (601179.SH).

▍ Haitong International's main views are as follows:

The annual investment in the power grid will exceed 500 billion yuan in 2024, maintaining a high level of prosperity.

On January 12, the State Grid held a 2024 working conference. It is expected that grid investment will continue to increase in 2024, which will exceed 500 billion yuan. From January to November 2023, China's grid investment scale was 445.8 billion yuan, up 5.9% year on year. Of these, the investment scale in November was 24.9 billion yuan, up 13.2% year on year. The acceleration trend of China's power grid investment is very obvious. It is expected that the full year of 2023 investment will exceed 520 billion yuan, an increase of more than 2% year on year. Power grid investment will continue to be booming in 2024.

Accelerate the construction of new power grids and build strong digitally intelligent power grids.

Xin Baoan pointed out that it is necessary to grasp the main principles of “44345,” namely “four major foundations,” “four major characteristics,” “three major connotations,” “four major functions,” and “five major values.”

The “four foundations” are UHV and UHV as the backbone grid, with power grids at all levels as strong support, driven by modern information technology such as the “Big Cloud Smart Chain”, and the path of digital intelligence and greening. The “four major characteristics” are strong climatic elasticity, strong safety and toughness, strong adjustment flexibility, and strong guarantee ability.

The “three connotations” are morphologically reflected in AC/DC hybrid, and various power grid forms such as large power grids, distribution grids, and microgrids are organically connected, and centralized and distributed energy systems complement each other; technically, they are reflected in the deep integration of digital technology such as artificial intelligence, edge computing, digital twins, blockchain, security protection, advanced information and communication technology, control technology, and flexible DC, friendly access to renewable energy, and source network load storage coordination and control; the elements are reflected in the deep integration of energy and power technology such as power flow, business flow, data flow, and value flow; the elements are reflected in multiple streams and forms such as power flow, business flow, data flow, and value flow, etc. Collaborative interaction between subjects, extensive flexible interconnection, new Energy is complementary in time and space over a wide area, and various types of power sources complement each other.

The “four major functions” are numerical intelligence to enable efficiency, power computing power integration, coordinated development of main distribution, and a strong and reliable structure. The “five major values” are to achieve full element sensitivity and real-time insight into the entire chain of the power grid, dynamic optimization of network structure, accurate control of production and operation, and intelligent adjustment of user behavior, highlighting rapid response, disaster prevention and disaster relief, and strong autonomous self-healing and self-healing capabilities. They support carbon interaction in source grid load storage, multi-energy coordination and complementary, large-scale high-ratio grid connection of new energy sources, etc., to meet the friendly access of various interactive actors such as electric vehicles, microgrids, new energy storage, virtual power plants, etc., to drive the advanced foundation of the energy and power industry, modernization of the industrial chain, and the strengthening of digital intelligent power grids Strong innovation as a new power grid , The functional value is fully reflected.

The construction of UHV and smart grids is progressing at an accelerated pace.

The North China Division of the State Grid cooperated to complete the preliminary work of ultra-high voltage “three straight and one crossing” projects such as Ulanbu-North China; collaborated with provincial (municipal) companies to advance the implementation of 500 kV cross-provincial projects to promote the integration of projects such as Xijoying - Fangshan, Xiong'an - Xinhang City into major local government action plans; State Grid Northwest China strengthens the main grid to support mutual protection between provinces, cross-regional delivery, and new energy consumption to achieve the three major roles of flexible interconnection of source network load storage, complementary time and space, and energy support; State Grid Beijing+ Electric Power “City Green” “Administrative Office Area” Near Zero Carbon Demonstration Zone, High Quality Construction of 110 kV Large Camp and Green Construction Integration Zero-carbon substation to build a 110 kV demonstration of a fully autonomous and controlled substation in Chengezhuang;

State Grid Anhui Electric Power carried out the “Shaanxi and Anhui DC” approval and construction, deepened the “Mongolian Electric Power” plan research, completed the “Ganzhezhe DC” territorial work, accelerated the approval of 8 projects including 500 kV Xiangjian-Ludao, and carried out a comprehensive three-year campaign to upgrade the distribution grid to fully ensure energy and electricity safety; State Grid Hunan Electric Power made every effort to promote the expansion of the main high-voltage transformers in the Xiangguang and Guangdong networks, and carried out preliminary research on the “Third DC” and “15th Five-Year Plan” regulations. Consolidate construction environmental factors to guarantee “first-in-command” projects, accelerate the construction of the “Ningxiang DC” project, and put into production key projects such as 500 kV Zhangjiajie on schedule;

State Grid Sichuan Electric Power will solidly push forward the “six major projects” such as the UHV Attack Project, the Panxi Power Grid Optimization Project, and the New Energy Consumption Project; State Grid Gansu Electric Power will optimize and improve the 750/330 kV main grid, promote the approval of the Longdian entry project into Sichuan during the year, approve the commencement of Longdian into Lu, Jiangdian into Chongqing, and Ningdian into Xiang, and focus on building strong power grids with large transmission terminals; State Grid Xinjiang Electric Power will empower the construction of strong digital power grids and accelerate the construction of new power systems.

Risk:

Policies fall short of expectations, raw material prices have risen sharply, etc.