More losses loom for China's thermal power plants

Rising global coal prices will drive up domestic coal prices and cause more losses for China's thermal power plants. This was the warning of the China Energy Research Society in its recent report.

"The economic recovery around the world, especially in emerging economies, will boost coal demand and push up coal prices, and cause China's coal prices to hike," said the report.

The CERS forecast that the domestic prices of coal for power generation would rise by about 4.5 U.S. dollars per tonne in comparison with last year, slashing the profitability of thermal power producers. China's thermal power plants suffered a total loss of US$5 billion in 2010, according to the China Electricity Council.

The five largest power producers, China Huaneng Group, China Datang Group, China Huadian Group, China Guodian Corp. and China Power Investment Corp. lost 12.4 billion yuan in their thermal power plants.

Yun Gongmin, general manager of China Huadian Group, said they were facing great pressure from rising coal prices and environmental protection.

China Guodian's general manager Zhu Yongpeng said the corporation's profitability was low, and a large proportion of its thermal power plants were suffering loss.