Thermal Power Generation Cos. Suffer From Integration Of Coal Resources


September 8 -- Thirteen thermal power generation companies recorded a loss of 2.31 billion yuan in the first seven months, and the total debt to fuel suppliers hit 2.99 billion yuan, reports China Business News.

The 13 companies had applied to local industry associations for support, but had not obtained any reply.

A mine manager from Datong Coal Industry Group said coal accounted for 70-80 percent of the total costs of Shanxi province's thermal power generation companies. The hike in power prices by 0.26 yuan per kilowatt hour did not really help these companies.

The director of China Electricity Council’s statistics department, Xue Jing, said Shanxi is one of the major coal resource bases in China. Local thermal power generation companies, especially those with coal mine-mouth power plants, used to obtain coal at lower prices.

With the rapid progress made in the integration of local coal resources, local power generation companies had lost their pricing power, and had been suffering supply shortages of coal since the first quarter of this year.

According to Xue, the integration had resulted in most of the coal resources being controlled by major enterprises, which further weakened the pricing power of local power plants.

Shares of Datong Coal Industry fell 0.44 percent to close at 15.78 yuan today.



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