Over 120 talks in eight months, intensive visits by central state-owned power enterprises, with one talk held every 1.5 days, what on earth are they planning?
In 2026, China's power industry is accelerating transformation, reshaping its business models and facing intensifying competition.
Energy Foresight learned that on September 14, Li Fumin, General Manager of China Three Gorges Corporation, met with Tan Chengxu, Chairman of Ansteel Group in Wuhan, and the two sides discussed high-end equipment manufacturing and direct green power connection. Two years ago, this would have been just an ordinary visit between central state-owned enterprises, but in 2026, it is a key piece just placed on a carefully laid-out chessboard.
By the end of August, the five major power generation groups alone had held more than 120 high-level meetings, averaging one every 1.5 days. The participants ranged from more than 20 provincial governments to Huawei, Unitree Robotics, Dongfang Electric and Bank of China. What did they talk about? There were 35 meetings related to power consumption accommodation and transmission, 18 meetings on computing-power and power synergy and digital intelligence, and 19 meetings on new scenarios such as direct green power connection. From the signing of a strategic cooperation framework agreement between State Grid and China Southern Power Grid to the planning of direct green power connection between China Three Gorges Corporation and Ansteel Group, when the top leaders of central state-owned power enterprises meet at an almost fully scheduled intensive pace, this is no longer a routine matter.
A clear signal is being released: China's power industry is switching from the logic of "selling electricity" to a brand-new survival logic.
Steel Mills Approaching Three Gorges Are Not Just Here to Buy Electricity
The most notable detail of the discussion between China Three Gorges Corporation and Ansteel Group is "direct green power connection". Green power, direct connection, bypassing the power transmission and distribution links of the power grid, allows power generation enterprises and large power users to connect directly. But between the steel industry and the power industry, it means that the collision of two logics is giving birth to a new business model.
Steel enterprises have always been large power consumers. In the past, their carbon reduction efforts mainly relied on purchasing green certificates or participating in power market transactions, which was equivalent to "buying green power across the power grid". Direct green power connection is completely different: a dedicated transmission line is built between the power generation end and the power consumption end for physical connection and point-to-point power supply.
The value of direct green power connection to steel mills is not limited to carbon reduction, but also lies in the restructuring of their cost structure. Transmission and distribution prices account for a considerable proportion of industrial electricity prices. Bypassing this link, there is substantial room for the comprehensive electricity cost of users to decrease. China Three Gorges Corporation has a controllable installed capacity of 168 million kilowatts, making it the world's largest hydropower development and operation enterprise; Ansteel Group produces tens of millions of tons of steel annually, and has rigid demand for electricity and carbon emissions. The interest alignment between the two sides cannot be summed up by a mere framework agreement — this is a business model of "new energy + industrial decarbonization" that is moving from policy documents into real life.
Among the 120 meetings of the five major power generation groups, the topic of power consumption accommodation and transmission accounts for the highest proportion, reaching 35 sessions. This shows that after the installed capacity of new energy expands to a certain scale, "generating electricity" is no longer a problem, and "where to transmit it" and "who will consume it" are the real bottlenecks. Direct green power connection, zero-carbon parks, and source-grid-load-storage integration are essentially different solutions to the same proposition: bypass the consumption blockages and send the generated green power directly to the pockets of users in need.
Computing Power Centers Are Turning Into "Power Banks"
On September 10, Zhang Wenfeng, General Manager of State Grid, held talks with Feng Laifa, General Manager of China Energy Investment Corporation, focusing on the "Southern Xinjiang New Power System Demonstration Zone" and the development of large new energy bases. In the same month, the executive meeting of the State Council clearly required to "promote the synergy of computing power and electricity, the integration of computing network, and accelerate the implementation of projects such as direct green power connection and source-grid-load-storage integration". The synergy of computing power and electricity was written into the government work report for the first time and included in the outline of the 15th Five-Year Plan. From the policy perspective, it has completed the leap from a concept to a national strategy.
But what really drives this track from "expectation-driven" to "order-driven" is the demonstration projects implemented recently. The first 100-megawatt-level computing-power and power synergy regulation in China was completed in the Northern Hebei Power Grid, and 11 computing power centers released more than 100 megawatts of power supply space in less than 10 minutes. What does this mean? Computing power centers are no longer just "electricity guzzlers" — they are becoming adjustable "virtual power banks". When the power grid needs it, the computing power load can be quickly reduced to allocate power to residential or industrial users.
Ulanqab has taken frequent actions. The city has built the country's first integrated source-grid-load-storage project that realizes direct green power connection, supporting 300,000-kilowatt wind and solar power stations and 45,000-kilowatt energy storage, realizing "determining the power source according to the load, and the power source following the load". Four computing power center projects in Zhangjiakou have been approved for direct green power connection, among which Heying Data centrally manages wind and solar power plants distributed in 3 counties and districts, 150 kilometers away from the computing power centers, to realize nearby power supply and local consumption.
The significance of these cases lies in verifying one thing: The power load of computing power centers can be scheduled in real time by the power grid. The quantitative analysis of Huatai Securities puts forward a more radical judgment: under optimistic scenarios, reliable power sources such as thermal power in China may face supply shortages around 2028, and both capacity electricity prices and green certificate prices will rise. The key variable of this forecast is the volume growth rhythm of domestic AI chips. Once the demand for computing power explodes, the power infrastructure will face a "strangulation" test.
The impact of computing-power and power synergy on the valuation logic of power stocks is fundamental. The P/B ratio of China's power stocks stabilized at 1.7 to 1.8 times between 2021 and 2025, and rose to 2.0 times in 2026 driven by the expectation of computing-power and power synergy. Huatai Securities believes that the market has not yet correctly understood the value of China's unique computing-power and power synergy — compared with the P/B ratio of U.S. IPPs soaring from 2.5 times to 14.5 times, the "AI concentration" of China's power assets is far from being priced.
With 5 Trillion Yuan of Investment Poured In, Who Will Get the Orders First
The policy framework is already very clear. During the 15th Five-Year Plan period, the national fixed asset investment in power grids will exceed 5 trillion yuan, an increase of more than 80% compared with the 14th Five-Year Plan period, with an annual average of more than 1 trillion yuan. State Grid's investment in 2026 will exceed 800 billion yuan for the first time, a year-on-year increase of more than 15%. Among them, the investment in distribution networks exceeded 50% for the first time, reaching 321.8 billion yuan, accounting for 50.3% of the total investment of 639.5 billion yuan — this means that the focus of power grid construction is shifting from the main grid to the distribution network.
The signal of orders is already being realized. The total winning bid amount of the first three batches of UHV equipment tenders in 2026 reached 29.261 billion yuan, exceeding the level of 22.062 billion yuan for the whole year of 2025. Institutions expect the full-year figure to exceed 40 billion yuan. Pinggao Electric won a bid of about 2.092 billion yuan in the second UHV tender this year, accounting for 16.71% of its operating revenue in 2025; it won another 1.818 billion yuan in the third tender, accounting for 14.53% of last year's revenue.
But what really needs to be guarded against is the thinking trap of "equal distribution of benefits". The 5-trillion-yuan big cake is not cut evenly, and the release of orders has a clear rhythm and structure. UHV equipment belongs to the "order-driven" category, with trackable and verifiable performance; station-area energy storage is a segmented track that is changing from a niche to a popular one. In the first half of 2026, the station-area energy storage orders of leading energy storage equipment manufacturers increased by about 230% year-on-year, about 70% of which came from power grid "unified construction and unified operation" projects. Shandong announced the completion of the country's first 100 MWh-level station-area cloud energy storage demonstration project, covering 400 station areas.
However, a gap is emerging between performance and stock prices. In the first half of 2026, the operating revenue of the power sector decreased by 1.75% year-on-year, and the net profit attributable to owners decreased by 15.05% year-on-year. Thermal power is squeezed by the dual pressures of rising coal prices and falling electricity prices, while new energy is affected by power restriction, electricity prices and cost pressures, with generally weak profitability. However, since September, the power sector has gone out of an independent market trend, with the core driving force shifting from short-term catalysts to the medium-cycle pricing of electricity price inflection points and profit elasticity. Research reports from China International Capital Corporation believe that the valuation of the power equipment industry has entered a historically undervalued range, and the prosperity may last until 2030.
The market's pricing logic has shifted from "who has the concept" to "who has the order". UHV and intelligent transformation of distribution networks are the directions with the fastest performance realization in the near future, while new business forms such as virtual power plants and computing-power and power synergy are still in the stage of policy catalysis and business model exploration. Investors need to distinguish between two types of targets: one is "certainty assets" with orders in hand and verifiable performance, and the other is "option-type assets" that are catalyzed by policies, have large imagination space but have not yet formed a mature commercialization path.
This Transformation Is Not Just About Doing Business
Among the intensive meetings of the five major power generation groups, there is another easily overlooked sector: overseas business.
The distribution network loss reduction project of China Southern Power Grid in Egypt has reduced the line loss rate from 17.6% to 6%, reducing the average daily lost power by about 15,000 kWh. PowerChina has implemented the largest single-scale electrochemical energy storage project in Central Asia in Uzbekistan, with a total investment of 85 million U.S. dollars, which can provide 219 million kWh of regulating power annually after being put into operation. The main structure of the main control building of the 1050 MWh independent energy storage power station project of China Energy Engineering Corporation in Egypt has been capped.
This is an upgrade of the "going global" model of Chinese power enterprises — from equipment export and engineering contracting to the output of systematic solutions including technical standards and operation management. The cross-border transmission lines of China Southern Power Grid in the Lancang-Mekong region have transmitted more than 84 billion kWh of electricity in total, and the first HVDC transmission line it undertook to build in Chile is expected to transmit more than 12.4 billion kWh of clean electricity annually. This spillover of capabilities is exactly tempered in the domestic market.
Back to the core question: Why are central state-owned power enterprises so intensively "visiting each other" at this point in time? Because the 15th Five-Year Plan is the window period for the reshaping of the power industry's business model. The fixed time-of-use electricity price system that has been implemented for more than 40 years has substantially withdrawn since March 2026, and the electricity price formation mechanism has officially entered the stage of "pricing following the market". Whoever can take the lead in establishing a sustainable profit model under the market-based electricity price mechanism — whether it is reducing user costs through direct green power connection, creating regulation value through computing-power and power synergy, or opening up incremental space through overseas projects — will take the lead in the next five years.
Each of the 120 meetings is a process of resource matching and interest restructuring. Behind the frequency of one meeting every 1.5 days, it is not socializing, but competition. The "pricing following the market" mechanism for electricity prices has been implemented, trillions of yuan of power grid investment is being released, and the power demand of computing power centers has just begun to explode. Getting the 5-trillion-yuan investment in place is the most realistic thing.