State Grid Corporation of China and China Southern Power Grid (CSG), two major power grid operators, pledged to reduce power prices of 112.6 billion yuan for commercial and industrial users, following Premier Li Keqiang proposed to extend the policy of reducing commercial and industrial power prices by 5% to the end of this year in the government work report on May 22.
State Grid expected to cut electricity bills by 92.6 billion yuan this year, including 63.1 billion yuan for over 400,000 heavy industrial companies, and 29.5 billion yuan covering 42 million common commercial companies.
CSG planned to help reduce the electricity cost by about 20 billion yuan this year, benefiting more than 7.6 million users.
The two grid operators said "they will take care of all involved price reduction" and won't transfer it to upstream power generators and appropriate governmental funds they collect.
The National Development and Reform Commission in February issued a document lowering power prices by 5% for commercial and industrial users from February 1 to June 30, to help them lower cost during the Covid-19 outbreak.
The May 22's announcement means the 5% cut policy will be extended to the end of this year.
Affected by the coronavirus epidemic, the two grid companies had a sharp fall the performance over the first quarter. State Grid reported its first-quarter's revenue fell 8.85% year-on-year, and profit slumped 106%, resulting in a net loss of 925.5 million yuan.
CSG's revenue decreased by approximately 10% year-on-year in the first quarter, and net profit fell 81.3% year-on-year to 827 million yuan.
As power consumption rebounds under a strong economic comeback from the Covid-19 epidemic, State Grid said its performance has improved. During January-April, the company reaped total revenue of 1.56 billion yuan and net profit of 50 million yuan, swinging to profit from the loss in the first quarter.
(Writing by Alex Guo Editing by Tammy Yang)
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