Jinping Xi

The Chinese government is mulling the creation of three energy giants, prompting a surge in shares of coal-fired generators on Tuesday.

Bloomberg reports that Beijing, under President Xi Jinping is looking at large scale coal power mergers as a possibility, while it examines reforming its state-run power sector. The mergers would involve eight companies with combined assets of almost $855bn.

Xi Jinping
The three planned power giants would be created through the following combinations:

  • China Huadian and China Guodian Corp., two of the biggest coal-fired power generators, may merge with China National Nuclear Corp., the second-biggest nuclear power operator in China. The combined company would have 297 GW of capacity and $295bn in assets, according to data published on company and regulator websites, as well as annual reports.
  • China Datang, one of the five biggest coal-fired generators, may merge with China General Nuclear Power Corp., the largest nuclear power operator, and Shenhua Group Corp., the country’s biggest coal miner, as well as a major rail operator and power producer. The combined company would have 241 GW of capacity and $302bn in assets.
  • China Huaneng, the country’s biggest coal-fired power producer, may merge with State Power Investment Corp., a coal-fired power company that also owns State Nuclear Power Technology Corp., the unit building the country’s Westinghouse-designed AP1000 third-generation nuclear reactors. The combined company would have about 262 GW of capacity and assets of $253bn.