The rapid development of the renewable energy market represented by wind power and photovoltaic has ushered in a golden development period for the SVG and inverter industries.

FC-RUSIO-3224 In recent years, under the background of “double carbon”, the accelerated development of renewable energy in China has become an important force to ensure the supply of electricity in our country. According to the latest data released by the National Energy Administration, the total installed capacity of renewable energy in 2023 in China reached 1.45 billion kilowatts, accounting for more than 50% of the total installed capacity of power generation in the country, and historically exceeded the installed capacity of thermal power. As of December 31, 2023, China’s renewable energy generation in the year of 3 trillion KWH, accounting for about 1/3 of the whole society’s electricity consumption; Wind power photovoltaic power generation has exceeded the domestic electricity consumption of urban and rural residents in the same period, accounting for the proportion of electricity consumption in the whole society exceeded 15%.

At the same time of rapid development of renewable energy market represented by wind power and photovoltaic, power equipment manufacturers represented by Xinfengguang, Siyuan Electric, Baili Electric, Shenghong Shares also ushered in a golden development period, SVG (high voltage dynamic reactive power compensation device), frequency converter and other power equipment demand continues to increase, so that the performance of related companies to maintain a stable growth trend.

Key equipment SVG enables big industry

FC-RUSIO-3224 The performance of some companies has entered a period of rapid growth

In the field of renewable energy generation, SVG, as the main product of power grid energy saving, environmental protection and power quality management, has been pushed to the foreground. It can not only provide capacitive or inductive reactive power rapidly and continuously, achieve constant reactive power, constant voltage and constant power factor control at the test point, but also ensure the stable, efficient and high-quality operation of the load side power grid system. Significantly improve the quality of power distribution and reduce the energy loss of transmission and distribution lines.

“SVG can help stabilize the power quality of the grid, including assisting in the implementation of high and low voltage crossing functions. Ren Qiguang, director of the Research and Development department of New Wind, said that for sites with poor grid characteristics and large load impact, such as metallurgical arc furnace sites, the instantaneous reactive power theory and double coordinate synchronous phase locking are used to achieve angular SVG fast reactive power FC-RUSIO-3224 compensation, negative sequence compensation and high order harmonic compensation control, which can greatly save energy consumption and improve the transmission quality of the grid.

At present, thanks to China’s vigorous promotion of the use of renewable energy such as wind energy and photovoltaic energy in recent years, most of the SVG manufacturers represented by Xinfengguang, Siyuan Electric, Baili Electric and Shenghong Shares on the A stock market have shown a stable growth trend. Taking the performance of the first three quarters of 2023 as an example, in addition to the year-on-year decline in revenue and net profit of Baili Electric, the revenue and net profit of New Scenery, Siyuan Electric, and Shenghong Shares all achieved double-digit year-on-year growth.

As a representative company in the SVG industry, the performance of New scenery in recent years is worth mentioning, its revenue from 2021 to 2023 in the first three quarters of 943 million yuan, 1.303 billion yuan, 997 million yuan, FC-RUSIO-3224 respectively, an increase of 11.72%, 38.23%, 38.67%; The net profit was 116 million yuan, 129 million yuan and 119 million yuan, up 8.77%, 10.86% and 49.28% respectively. Among them, the company’s SVG business revenue in the photovoltaic industry in 2022 exceeded 500 million yuan, an increase of 102.9%.

For the wind power and photovoltaic industry, although the stage overcapacity situation is still very prominent, so that the performance of many companies in the industry chain is under pressure, but it can still be seen that the head enterprises represented by Tongwei Shares and Daqo Energy are choosing to expand against the trend. Taking Tongwei shares as an example, it threw out a 28 billion investment plan at the end of 2023, including an annual output of 500,000 tons of green substrate (industrial silicon), 400,000 tons of high-purity crystalline silicon projects and supporting facilities. The active expansion of the PV industry’s leading companies may imply that the future growth and prosperity of the new energy industry still has a high degree of certainty.

FC-RUSIO-3224 Just recently, some SVG manufacturers disclosed 2023 performance or performance forecast, from the forecast content, these companies still maintained rapid performance growth in 2023. For example, on January 17, Siyuan Electric released the 2023 annual performance report, with operating income of about 12.451 billion yuan, an increase of 18.16%. Net profit attributable to shareholders of listed companies was approximately RMB 1,545 million, an increase of 26.6% over the same period last year; On January 18, Shenghong Shares released the 2023 annual performance forecast, which shows that the net profit of shareholders of listed companies is expected to be 350 million yuan to 430 million yuan in 2023, an increase of 56.57% to 92.35%.

In this regard, Flush new energy analyst Wu Qiyuan said that SVG as a key device in the field of new energy segmentation, the relevant manufacturers will continue to bring performance with the rapid development of the new energy industry, and not due to the internal volume of the new energy industry, because the overall competition pattern of the SVG industry is still relatively stable, and the gross margin level is also at a high level. There are certain technical barriers.

FC-RUSIO-3224 Hu Shunquan, general manager of New scenery, also pointed out that the higher the SVG voltage level, the stronger the technical barriers, in recent years, domestic brands continue to rise, product quality is steadily improving, compared with imported brands more cost-effective, as the product continues to move towards the high voltage end, only a few enterprises have the ability to meet market demand. “In accordance with the requirements of the State Grid for new energy generation scheduling, it must be equipped with the corresponding SVG equipment, with the rapid iteration of technology, cost reduction, and higher and higher reliability.” As long as the country vigorously develops the new energy industry, SVG will have a broad market space. ”

For the future development prospects of the new energy industry, the industry has also given high expectations. On January 11, 2024, hosted by the Institute of Carbon Neutrality of Tsinghua University and hosted by the School of Environment of Tsinghua University, the report conference of “China’s Landscape Technology Outlook under the goal of carbon neutrality” was held, and the report pointed out that under the background of “dual carbon”, China’s future wind and solar power generation will be doubled. Under the goal of carbon neutrality, the installed capacity of wind power and photovoltaic in 2060 in China will reach more than ten times the total installed capacity of wind power in 2020, and with the continuous development of wind power generation technology and the improvement of power generation efficiency, the wind power generation in 2060 will reach more than thirteen times the wind power generation in 2020.