According to announcements from Solar Power and Jinkai New Energy, multiple new energy power generation operators have recently received concentrated renewable energy subsidy funds. Solar Power's subsidiary photovoltaic project companies received subsidy funds from January to August with a year-on-year increase of 232%, reaching 170% of the full-year 2024 amount. Jinkai New Energy received subsidy funds from January to August with a year-on-year increase of 342%, reaching 190% of the full-year 2024 amount.
According to institutional understanding, operators intensively received a batch of subsidy distribution notifications at the end of August, clearly accelerating the distribution of renewable energy power generation subsidies. Against the backdrop of wind and solar project profitability being squeezed by market-oriented trading on the revenue side and anti-involution price increases on the cost side, "concentrated distribution of historically overdue subsidies" represents a potential policy tool that can immediately stimulate developer investment enthusiasm (after concentrated subsidy distribution in 2022, domestic photovoltaic/wind power installations increased by 148%/102% year-on-year in 2023).
With accelerated subsidy distribution, operators' financial resources for investing in new energy power generation projects have been significantly replenished. Both the investment capacity and motivation for wind power, energy storage, and photovoltaic projects will be effectively enhanced, thereby achieving positive effects of driving sustained growth in wind power installation capacity, actively deploying high-quality energy storage to address market-oriented trading, and forming support for photovoltaic installations.
Wind Power: Subsidy distribution further strengthens expectations for installation growth in 2026. Combined with the strong recovery in August wind power bidding and further increases in average winning bid prices, industry volume and price performance continues to exceed expectations. We favor three main investment themes in sequence: complete machines, offshore wind, and components. Related Hong Kong-listed companies in the industry chain include: GOLDWIND (02208) and others.
Energy Storage: Market-oriented trading drives wind and solar operators to actively and voluntarily deploy high-quality energy storage. After Document 136 "cancelled mandatory allocation," large-scale storage demand has increased rather than decreased, with improved market structure expected. Recently, leading energy storage battery companies are approaching full capacity, with some beginning to raise prices. Related Hong Kong stocks include: CATL (03750), CALB (03931), and others.
Solar Power: Subsidy distribution is expected to provide certain support for domestic demand in 2026, helping accelerate large-scale base projects while maintaining high overseas demand prosperity. Global demand is expected to remain stable in 2026. Industry chain prices and profitability have consolidated at the bottom, with "anti-involution" driving prosperity recovery. The sector is in a cyclical bottom layout window period. Related Hong Kong stocks include: ST Energy (01799), GCL TECH (03800), Xinyi Solar (00968), Xinyi Glass (00868), Flat Glass (06865), and others.