February** Dynamic Incentive Program
Electricity, the lifeblood of modern society, allows us to focus on this magnificent and huge power grid system. As we all know, the State Grid and China Southern Power Grid are giants in the power field, however, the staggering figure of 3 trillion yuan of debt hidden behind it is incomprehensible.
Huge liabilities hidden by huge assets.
As of June 30, 2022, the total assets of the State Grid were as high as 48,0979.7 billion yuan, and the total assets of China Southern Power Grid are 111137.9 billion yuan, a total of nearly 6 trillion yuan. This huge number has allowed these two companies to break into the Fortune Global 500, and the State Grid is the leader of the Fortune 500 in China.
However, under this glamorous appearance, there is a hidden truth about huge debts. According to the financial report data, as of the third quarter of 2022, the debt of the State Grid is as high as 26,4302.8 billion, with an asset-liability ratio of 5495%；The total liabilities of China Southern Power Grid are 67464.3 billion, with an asset-liability ratio of 607%。These figures underscore the enormous economic pressures, which are too heavy given China's population of 1.4 billion.
The annual salary of power grid employees**, the truth is revealed.
A 2006 report lifted the mystery of the power grid industry, and the headline "100,000 yuan a year for a meter reader at a power plant" caused a huge sensation on the Internet. The article ** shows that the monthly salary of a meter reader in an urban power plant is as high as 6,500 yuan, and it also includes 16 months' salary and benefits such as year-end bonuses. This has aroused strong concern among the people, and questions have been raised about whether the monopoly of state-owned enterprises is unreasonable.
To this day, people are still suspicious of rumors that State Grid employees earn up to 200,000 yuan a year. In fact, there are differences in employee salaries in different regions, such as Shandong, Beijing, and Shanghai, and the salary of employees is generally about 180,000, and the salary of most employees in Fujian, Guangdong, and Chongqing is about 130,000, while Shaanxi, Shanxi, and Jiangxi are about 120,000. Although there are differences in regional welfare systems, the benefits of State Grid include basic salary, performance salary, five social insurances and one housing fund, and year-end bonuses, etc., and the welfare system is not inferior to other industries.
Public welfare and troubles of power products.
Electricity, as an indispensable product for residents' production and life, has a strong public welfare. However, this is also one of the reasons for the loss of the power grid. Residential electricity consumption** needs to go through multi-layer audits, and it is difficult to increase slightly. In fact, at the beginning of this century, China's residential electricity consumption was 06 yuan, so far ** has changed very little. However, the inflation rate has risen, the raw materials of the power grid have remained high, and the increase in raw materials such as coal has far exceeded the limit of electricity price adjustment, resulting in losses for power companies across the board.
Heavy investment in the construction and maintenance of power grids.
The construction and maintenance of the power grid is a huge investment. In order to ensure the stability of power generation, the State Grid and China Southern Power Grid need to continue to invest in the construction and transformation of power grids. These investments have a long payback period and take years to see effective returns. This reflects the long-term capital needs of the power sector and the delay in the payback cycle, which requires long-term investment and planning to maintain the health of the power system. As a capital-intensive industry, the power industry needs a steady stream of capital investment, which mainly relies on state support and electricity fee collection.
However, in order to meet the low-cost demand for residential electricity, the state has set the electricity tariff** very low, which puts huge pressure on the revenue of the power grid, and needs loans to fill the gap every year. This has become a major reason for the loss of the power grid.
Grid coverage challenges and inevitable trends of development.
Under the development of the new era, the national policy requires that electricity be covered to every corner of the country to ensure that the people of the whole country can enjoy the power resources. Since its establishment in 1956, the power grid has been carrying out power coverage projects, and the difficulty of power coverage lies in remote mountainous areas. The remoteness of these mountainous areas and the rugged roads make it difficult to build power grids.
After decades of operation and construction, China's power grid coverage rate is now as high as 98%, covering more than 1.1 billion people. State Grid will continue to work on power transmission coverage as part of China's efforts to close the gap in the power sector.
Conclusion: How to balance the balance of livelihood projects and profits.
Grid losses seem inevitable, and a number of factors such as high investment, infrastructure maintenance, and electricity subsidies have contributed to this situation. In the power sector, China is a catch-up and needs to gather capital and invest a lot of money in the power industry.