Shanghai Electric Power: make concerted efforts to control the coal price and make persistent efforts to reduce the cost

A piece of exciting good news came from the recent monthly-meeting of Shanghai Electric Power:in terms of foreign settlement,the coal price of Shanghai Electric Power from January to September was 964 Yuan/ton, reducing 82 Yuan/ton year-on-year. This achievement was obtained by concerted efforts of departments,especially the Fuel Department and by close cooperation between fuel companies and coal power plants.What's more importantis that numerous leaders and workers from Shanghai Electric Power implemented the principle of "increase profits,focus on development,promote harmony",carried forward "three thousand spirit" and made full use of the principle"easy-going outside and solemn inside".

As we know,coal price which accounts for 70% oftotal cost,is the main factor hindering thermal power enterprises from making profits. For years,Shanghai Electric Power has been suffering from the rise of coal prices.This year,coal prices tended to decline.Shanghai Electric Power seized the opportunity,quickly acted to adjust deployment,clearly put forward the principle of "three combinations" for coal procurement(i.e.,organic combinations of advantage and disadvantages,technical and economic index and power plant, inventory and power tendency ),and required taking various effective measures to keep coal prices approximately at 1,000 Yuan/ton by all means. In September,coal prices in terms of foreign settlement were controlled at the low level of 844 Yuan/ton which was for the first time lower than the coal prices of benchmark enterprises at the same region for the recent years and made great contributions to Shanghai Electric Power's completion of annual business objectives.

Under the long-term game in the coal market,it isn't easy to control coal prices,especially to reduce them. It's not only a hard job needing to be finished with heart and wisdom,but also a system engineering which requires carrying forward the ability of teamwork and applying various measures simultaneously. The currently obtained coal prices firstly benefited from high attention of the company leaders who timely put forward the principle of "three combinations" and incentive measures.In addition,leaders in charge of coal price personally coordinated production and procurement,which provided coal price control with powerful organizational guarantee. Secondly,thanks to active response and careful implementation of fuel companies,teamwork of company's functional departments and introduction of performance appraisalcoal price control was guaranteed with scientific and reliable mechanism. Thirdly,power plants served the overall interests,constantly summarized experience based on safety,and increased the mixing combustion proportion of low grade coal in an honest way through technical renovation and optimal operation.Therefore,coal price control obtained enterprise's positive response and supply quantity guarantee. Meanwhile,during the process of coal price control, Shanghai Electric Power strengthened control forces,continuously improved management level,standardized the behaviour of coal procurement and established the list of qualified suppliers, so as to make coal transaction above open and transparent. Because of all above-mentioned effortsthis year, there appeared a good situation in the coal price control of Shanghai Electric Power where coal in the plan and market coal could be priced according to actual situation,high-quality coal and low grade coal could be combusted effectively in a mixed way,and coals at home and abroad could supplement each other.

Coal prices were initially under control.However,can this situation be kept continuously in the next three months?How can they continue to deeply make scientific analysis and correct pre-judge for coal market of next year and vigorously seize electricity production to change the cost advantage of coal price into operating profits when power market is unclear?All these are events and difficulties in front of Shanghai Electric Power.And the security system for Shanghai Electric Power to achieve better business performance and successfully complete the missions assigned to it from the Group is to continuously adhere to "three combinations" in the fuel work,mixing combustion of low grade coal and exploitation of coal abroad,and meantime to stick to management and technical innovation in the fuel work and to maintain stability and harmony of the team during the reform process.

Shanghai Electric Power will make concerted efforts to control the coal price and make persistent efforts to reduce the cost.Even though Shanghai Electric Power still have far to go to achieve this goal,it looks promising.

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