China Datang Corp. Renewable Power Co., a state-owned wind-energy developer, said 2012 profit declined 85 percent as slower first-quarter wind speeds and “grid curtailment” in some regions reduced power generated
Net income fell to 112.1 million yuan ($18 million) from 729.8 million yuan in 2011, Datang Renewables said yesterday in a statement to the Hong Kong stock exchange. This compares with the 243.7 million yuan mean of nine analyst estimates compiled by Bloomberg. Revenue increased 14 percent to 4.37 billion yuan.
China’s electricity grids are unable to absorb the influx of wind power, forcing the government to tighten approvals on new projects and slow the development of the industry. Installations of wind turbines in China fell 18 percent to 15.9 gigawatts last year from 2011, according to data compiled by Bloomberg New Energy Finance.
“In order to guarantee income from the wind power business amid severe grid curtailment, the group proactively controlled the construction progress of wind-power projects,” Datang Renewables said yesterday. Total installed capacity rose 9.7 percent in 2012 to 5,771 megawatts on Dec. 31, Datang said.
The National Energy Administration issued new permits for wind farms on Mar. 19, except in Jilin, Inner Mongolia and Heilongjiang provinces, where the grid has been overloaded with renewable energy. The NEA said it will work to improve connections of wind power to grids.
The stock rose 4 percent to close at HK$1.57 in Hong Kong trading yesterday, before the company announced earnings. The shares have gained 59 percent this year, compared with a 2.4 percent decline in the city’s benchmark Hang Seng Index.