The five major state-owned power generation companies in China all suffered serious losses. Why are power grid companies still making serious profits?

The five state-owned power generation companies are the most upstream in the industrial chain to produce electricity, and then sell it to power grid companies (mostly thermal power and hydropower) after consuming fuel. Because power companies and grid companies are separated, and transmission and distribution are unified, grid companies will reduce the on-grid tariff or forcibly limit the output of power plants within the permitted scope. This is a unique right. On the other hand, we all know that in the industrial chain, the "second-hand dealer" usually has the highest profit, and the power grid company plays such a role, and it also has a unique monopoly nature.

The five state-owned power generation companies are limited by one-time investment and raw material costs (high prices of coal, oil and natural gas), and the necessary environmental protection measures such as desulfurization and denitrification required by the state make the profit space of the five state-owned power generation companies very narrow.