Recently, the National Development and Reform Commission and the National Energy Administration jointly issued the "Notice on Orderly Promoting the Development of Green Electricity Direct Connection," aimed at exploring innovative integration models for new energy production and consumption, promoting local consumption of new energy, and better meeting enterprises' green energy demands. Research suggests that the green electricity direct connection policy helps optimize grid allocation mechanisms, promotes direct connection between new energy generation and data centers, and provides policy support for synergy between waste incineration power generation and data centers in energy use and conservation.

The "Notice on Orderly Promoting the Development of Green Electricity Direct Connection" represents the first national-level policy permission and regulation involving green electricity direct connection, balancing both efficiency and fairness. The introduction of green electricity direct connection policy helps achieve multiple objectives including local new energy consumption, meeting users' actual green electricity demands, and reducing costs for end users. The policy balances fairness and efficiency - direct connection projects need to bear transmission and distribution fees and system operation costs, but can also reduce project operating costs by decreasing grid connection capacity requirements. Green electricity direct connection projects allow power sources and loads to be implemented by different investors, providing significant support for the release of demand for green power source-grid-load-storage integration and waste power generation plus AIDC.

Research indicates that the waste incineration power generation industry saw narrowing revenue declines in the first half of 2025, with performance stabilizing and recovering, showing continuous improvement trends in both operational and non-operational segments. Based on data from solar and other green power companies, renewable energy subsidy funds from January to August 2025 have reached the highest level since 2020, suggesting that the chronic problem of profit and cash flow mismatch for waste power generation companies may be resolved, and undervalued waste power generation companies may welcome revaluation. The industry's dividend signals turned positive in the first half of 2025, and enhanced industry returns are worth anticipating.

Related Hong Kong waste power generation stocks:

EB ENVIRONMENT (00257.HK): Net profit fell 10% year-over-year in the first half. Excluding one-time items, profit before tax (PBT) grew 23% year-over-year, significantly beating expectations. Interim dividend increased by 1 HK cent, with payout ratio reaching 42%, up 7 percentage points year-over-year. Bank of America Securities reiterated EB ENVIRONMENT's "Buy" rating, expecting full-year yield to reach an attractive 6.5%, with potential upside for dividends. The bank raised 2025-27 earnings per share forecasts by 23-38% to reflect improved gross margins in waste power generation, green technology and wastewater treatment businesses, reduced impairment losses, and lower debt costs. In April 2024, EB ENVIRONMENT, under China Everbright Group, completed a waste-to-energy project in Thua Thien Hue Province, Vietnam, with Vietnamese Prime Minister Pham Minh Chinh attending the completion ceremony. Located in Huong Thuy City, Thua Thien Hue Province, the Hue project covers approximately 11 hectares with total investment of about $74.55 million.

Yuefeng Environmental (01381): Yuefeng Environmental is a leading company in the waste power generation industry. The company's 13 waste incineration power generation projects received a total of 3,331,857 Green Electricity Certificates (GEC) from China's National Energy Administration. Additionally, the Yingkou waste incineration power generation project obtained 240,980 tons of Verified Carbon Standard (VCS) Voluntary Carbon Units (VCUs), marking the first VCS-approved Chinese waste incineration power generation project in 12 years. The company will pursue low-carbon production and emission reduction certification for more projects in the future to promote green and low-carbon development. On May 21, Grandblue Environment (600323) announced plans to privatize Yuefeng Environmental through its controlling subsidiary Grandblue (Hong Kong) Environmental Investment Limited, making Yuefeng Environmental its controlling subsidiary and delisting it from the Hong Kong Stock Exchange.