Analysis of Curtailment Challenges and Response Strategies for CECEP Wind-Power

Based on the obtained company announcements and research reports, CECEP Wind-Power (601016.SH) is indeed facing severe curtailment challenges. Here is a detailed analysis:

According to the company’s 2025 semi-annual report, the curtailed electricity volume shows a year-on-year rising trend [0][1]:

Period	Curtailed Electricity (10,000 kWh)	Percentage of Available Generation
2023	133,385	9.00%
2024	140,970	10.33%
Jan-Jun 2025	120,897	16.47%

• Gansu
  : 35,901 thousand kWh curtailed, accounting for 23.49%
• Xinjiang
  : 31,368 thousand kWh curtailed, accounting for 20.50%
• Hebei
  : 20,028 thousand kWh curtailed, accounting for 15.54%

The company’s announcement points out that the main causes of wind curtailment include [1]:

1. Overcapacity in the power industry
   : The growth rate of power supply capacity is faster than that of demand
2. Existing power operation management mechanism is not adaptive
   : Unscientific power generation plans for coal-fired units and inadequate incentive policies for auxiliary services
3. Lagging construction of cross-provincial transmission channels
   : Mismatch between resource-rich regions and electricity load centers

In response to curtailment challenges, the company is taking multi-dimensional measures to ensure project revenue:

• Accelerate the construction of green power transmission channels
• Increase the proportion of electricity sold through market-oriented transactions
• Actively explore new models such as
  green power direct connection, green power substitution

• Supporting energy storage solutions
• Independent energy storage project development
• Application of new technologies like virtual power plants
• Explore the power auxiliary service market

• Through policy breakthroughs, technology adaptation, and business model innovation, transform the wind curtailment dilemma into a ‘new growth pole’ for green power value-added

• Price-to-Earnings Ratio (P/E)
  : 21.41x
• Price-to-Book Ratio (P/B)
  : 1.08x
• Return on Equity (ROE)
  : 5.07%
• Net Profit Margin
  : 19.46%
• Current Ratio
  : 2.84, with sound financial status

• Accounting Policy
  : Conservative (high depreciation/capital expenditure ratio)
• Debt Risk
  : Medium risk

• Against the backdrop of full market entry of new energy, wind power yield still has a safety margin [2]
• The company’s green power assets are pure, and wind power projects have long-term competitiveness
• The green power track has long-term potential, and the cash cow attribute is gradually emerging

• Total profit in the first three quarters of 2025 decreased by 59.60% year-on-year [3]
• Net profit from the beginning of the year to the end of the reporting period decreased by 36.45% year-on-year
• If the rising trend of curtailment rate cannot be effectively curbed, it will continue to affect performance

: The curtailment rate of around 18% faced by CECEP Wind-Power does put pressure on short-term performance, but the company is actively responding through consumption improvement measures and business model innovation. In the long run, with the advancement of new power system construction and improvement of consumption conditions, there is still room for improvement in the revenue guarantee of wind and solar base projects. Investors should pay attention to the company’s curtailment rate trend and the increase in the proportion of market-oriented transaction electricity.

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[0] Jinling API - CECEP Wind-Power Company Profile and Financial Analysis Data (2025-12-27)

[1] CECEP Wind-Power Co., Ltd. 2025 Semi-Annual Report (https://stockmc.xueqiu.com/202508/601016_20250829_IN54.pdf)

[2] Soochow Securities - New Energy Full Market Entry Research Report (https://pdf.dfcfw.com/pdf/H3_AP202507181710804556_1.pdf)

[3] CECEP Wind-Power Co., Ltd. 2025 Third Quarter Report (http://notice.10jqka.com.cn/api/pdf/3c26640512b7c005.pdf)