Development and Reform Commission Increases On-grid Prices

It is understood that in order to solve the problem of sustained losses of power generation companies, the National Development and Reform Commission's Price Division has recently raised the price of electricity in some provinces and cities. Although this price increase has not yet reached end-users, fertilizer companies suffering from coal prices are still feeling great pressure.

The National Development and Reform Commission raised the on-grid tariffs of 16 provinces (autonomous regions and municipalities) across the country on April 10, and the average price of the on-grid tariffs of the 16 provinces was raised by about 1.2 cents/degree. The price adjustment only increased the loss of thermal power companies' on-grid tariffs, the terminal sales price did not link up, and the increase in costs was borne by the grid companies. However, according to industry analysts, industrial electricity accounts for more than 70% of total electricity consumption. With some provinces and municipalities increasing their on-grid tariffs, adjusting industrial electricity consumption may become a trend.

For fertilizer companies, especially nitrogen fertilizer companies are currently suffering from high coal prices, fine washed anthracite coal prices have exceeded 1,700 yuan / ton, up more than 700 yuan over the same period last year, resulting in a substantial increase in production costs. If the price of electricity is increased, nitrogen fertilizer companies will be worse.