Analysis of Global Power Market

Analysis of China's Power Operation Market Breakdown of Cost for Power Generation Breakdown of Power Generation Cost (thermal power by coal), China, 2018 12% 9% 14% 64% Fuel Cost Depreciation Cost Payroll and Maintenance Cost Other Cost Breakdown of Power Generation Cost (hydropower), China, 2018 31% 65% 4% Depreciation and Financial Cost Payroll Cost Other Cost • Highlights Power generation cost structure is significantly different between thermal power and hydropower. Close to 64% of the power generation cost by thermal power is consumed by fuel. Other significant cost components include depreciation cost (14%) and payroll and maintenance cost (12%). As for hydropower facilities, a majority of the power generation cost is contributed by depreciation expenses, relating to the initial capital investment on constructing dam, spillway and water transfer tunnels, together with purchasing and installing mechanical equipment. Financial expense which is incurred for capital raising to finance hydropower project is also a major cost component. Payroll accounts for around 4%. The rest of the amount mainly includes repair and maintenance, tax, etc.. FROST & SULLIVAN Source: Frost & Sullivan 68

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