Huachuang Securities: New energy remains a core direction of the 13th Five-Year Plan, and the electricity market mechanism is expected to be further improved.

Huachuan Securities released a research report stating that based on the policy orientation of the "Fifteenth Five-Year Plan," four investment logics have been outlined: 1) New energy: the growth of installed capacity has strong certainty, improved absorption coupled with green certificate premiums opening up profit elasticity; 2) Thermal power: the profit structure is diversifying towards "electricity + capacity + auxiliary services," enhancing profit certainty; 3) Hydropower: stable cash flow combined with future integration of water and wind power for long-term growth; 4) Nuclear power: the target for operational installed capacity by 2030 is 110 million kilowatts, a significant increase from 2025, with high growth certainty. The main view of Huachuan Securities is as follows: Fourteenth Five-Year Plan vs. Fifteenth Five-Year Plan: How will the top-level narrative of building a new energy system evolve? 1. Energy security: from macro positioning to ground-level implementation, expanding in-depth connotations. The Fourteenth Five-Year Plan emphasizes "strengthening bottom-line thinking and ensuring diversification," while the Fifteenth Five-Year Plan adds new requirements to "establish a strategic energy security bottom line in extreme scenarios," with a quantified target for coal reserves for the first time, aiming to form production capacity reserves of over 100 million tons per year by 2030. The connotations of energy security extend upstream along the industrial chain as the proportion of new energy increases. 2. Development of new energy: the positioning is enhanced, with comprehensive quantification of flexibility. The new energy section is moved to the second chapter, stating in the plan that in the Fifteenth Five-Year Plan, solar and wind power will account for over 50% of installed capacity, becoming the main body of electricity generation, and non-fossil energy generation will account for 50% of electricity. Flexible resources have transitioned from qualitative guidance to quantitative assessment, with targets such as pumped storage reaching 160 million kilowatts by 2030, new energy storage reaching 300 million kilowatts, and the regulation capacity of virtual power plants exceeding 50 million kilowatts. 3. Energy consumption: discussed independently, construction of a green pricing mechanism may be expedited. "Constructing a green and low-carbon energy consumption system" is the fourth chapter in the Fifteenth Five-Year Plan, with the carbon management system upgraded to "comprehensive implementation of carbon emission dual control system." The green certificate system now combines mandatory and voluntary consumption, and for the first time proposes to "enhance international recognition of green certificates," building a solid institutional foundation for increasing green premiums. What to focus on in the future based on the "Fifteenth Five-Year Plan"? 1. New energy remains one of the core directions of the Fifteenth Five-Year Plan. The main role of new energy is established, and a comprehensive multidimensional indicator system is fully implemented. By 2030, total installed power capacity will increase to 540 billion kilowatts, and the share of non-fossil energy consumption will increase to 25%. The plan differentiates the positioning of new energy, thermal power, hydropower, and nuclear power: new energy focuses on absorption, thermal power transitions to regulation power sources and supports capacity compensation and auxiliary service mechanisms, while hydropower and nuclear power steadily enter the market. Key projects are fully implemented with specific names and timelines, with hydrogen energy, green fuel, and direct connection of green electricity becoming two new directions for new energy absorption. 2. Flexibility exceeds expectations. From qualitative planning to quantitative assessment, the four directions grow coordinately. The focus of thermal power transformation is on deep peak shaving and rapid ramping capabilities; pumped storage, new energy storage, and demand-side management all set clear quantitative targets for 2030 for the first time. The four directions collectively support a 40% increase in source-storage regulation capacity, significantly enhancing the policy feasibility of flexibility building. 3. Green energy consumption is discussed separately, and green premiums for new energy in the Fifteenth Five-Year Plan are expected to transition from expectations to reality. On the supply side, carbon emission dual control and carbon market construction work in tandem; on the demand side, the improvement of the responsibility-weighted system and the expansion of emerging scenarios such as zero-carbon zones and direct connection of green electricity form demand channels. Overall, tightened quotas, internationalization of green certificates, and scenario expansion all constitute the institutional foundation for gradually increasing green premiums. 4. Market mechanisms transition from pilot to formal operation, with further improvements expected. The overall goal has been upgraded from "accelerate construction" to "basic completion," with provincial spot markets and southern regional markets officially entering operation, and capacity markets being included in the system for the first time, while gas, hydropower, and nuclear power steadily enter the market. The plan specifically states the need to "continuously rectify inappropriate interventions by local governments in the electricity market," signifying a more substantial implementation. Risk warning: Delay in the progress of electricity market reform; sharp rise in coal prices exceeding expectations; reduced hydropower output due to reduced water inflow; delays in approval of nuclear power projects; uncertainty in the pace of implementation of green certificate pricing mechanisms.