Two months ago, the Anti-Monopoly Bureau of the National Development and Reform Commission and the Shanxi Provincial Anti-Monopoly Bureau interviewed the Shanxi Electric Power Industry Association and the eight major power generation groups of the province. In response to the ''Shanxi Thermal Power Enterprises to Prevent Malicious Competition and Protect the Industry The "Convention on Healthy and Sustainable Development" (hereinafter referred to as the "Convention") caused a monopoly in electricity prices and issued huge fines, which is a semi-open secret in the industry. On May 18, at the application of Shanxi Electric Power Industry Association and 18 coal-fired power generation enterprises, Shanxi Provincial Development and Reform Commission held a hearing on administrative punishment for the punishment results. A dispute between monopoly and anti-monopoly, true and false markets has finally been stripped of its hazy coat and exposed to the public.

This event is like a blockbuster, attracting high attention from the industry. But when people look to the event itself at the same time, we seem to see the hidden behind the event, to see the current collective anxiety of the vast number of power enterprises: survival or perish? Surviving or being incorporated? The core of the whole incident is that the Shanxi Electric Power Industry Association "series" a number of thermal power enterprises to formulate the Convention, and jointly agreed: according to the market situation, the large power generation groups and power generation enterprises, in accordance with the principle of cost plus small profit, calculate the minimum transaction quotation for direct supply of large users, which will be announced and implemented after the weighted average of the Power Saving Association. And reached an agreement that the quotation for the second batch of direct power supply transactions in 2016 will not drop more than 0.02 yuan/kWh compared with the benchmark price on the Internet. It seems to be a monopoly, but it is not to seek huge profits, but to set a lower limit for losing money. What is the purpose of such a "monopoly?

The state vigorously promotes the marketization of power production and supply. Since March 2015, the Central Committee of the Communist Party of China and the State Council have issued "Several Opinions on Further Deepening the Reform of the Electric Power System", proposing to steadily promote the reform of the electricity sales side and orderly liberalize the distribution of electricity to social capital. After that, two core documents were introduced, "Measures for the Administration of Access and Exit of Electricity Sales Companies" and "Measures for the Administration of Orderly Liberalization of Distribution Network Business. A series of measures have been highly expected by industry insiders, who believe that they can break the status quo of power grid monopoly to a certain extent. However, the facts did not go as smoothly as expected. In order to achieve monopoly, some enterprises suppress the price of the vast number of production enterprises, sell electricity at a price far lower than the cost price, and squeeze the living space of small and medium-sized enterprises. According to statistics, in recent years, the average price of direct supply for large users is far lower than the benchmark electricity price and cost price, forcing other power enterprises to carry out price war. For example, in Shanxi Province, according to the statistics of the Energy Supervision Office, 10 thermal power enterprises lost money in 2015, with a loss area of 20%. In 2016, 33 of the 55 provincial thermal power enterprises lost money, with a loss area of 60%. Behind the loss is that the average cost of power generation in 2016 was 0.292 yuan/kWh, while the average transaction price of the first batch of direct power supply was only 0.133 yuan/kWh. This is a serious malicious competition phenomenon in the process of power trading in order to obtain power generation by some thermal power enterprises, competing to sell electricity at a price far below the cost, disrupting the market.

It is in this case that Shanxi Electric Power Industry Association and power generation enterprises jointly formulated the Convention. The result is that in the second batch of direct transactions by large users in Shanxi in 2016, the highest transaction price of each enterprise was 0.3205 yuan/kWh, which was the same as the benchmark electricity price just adjusted in January 2016, and the lowest transaction price was 0.295 yuan/kWh., Which is 2 points lower than the on-grid electricity price, and the total profit is 0.6 billion yuan for users. The "Convention" stipulates the lower limit of price. Under the appearance of seemingly monopoly, it has the original intention of anti-monopoly, and has also achieved certain results in regulating market behavior. However, there may be certain problems in the specific writing and operation.

In recent years, the development of electric power enterprises only seems to be prosperous. On the one hand, large-scale power supply enterprises are making an overwhelming low-price offensive, and on the other hand, the cost of coal and electricity is rising. Small and medium-sized power companies (especially thermal power) living space is getting smaller and smaller, but they have to passively engage in price wars. It can be said that the result of the struggle between the snipe and the clam can benefit the users in the short term, but in the long run, it is easy to form the control of the power supply oligarchs over the whole power supply market, including the pricing power. This reminds us of the competition between Didi and Uber. Didi has been laying out the online car market since 2012. At the same time, there are some other enterprises eager to try. The biggest competition comes from Uber. During the market enclosure stage, the two sides sent a large number of taxi-hailing red packets to consumers, and at the same time gave drivers a large number of subsidies. The vast number of consumers liked to run and even did not drive their own cars, so they used the Internet to hire cars one after another. In less than three years, the struggle between the two giants ended with Didi buying Uber's business in China. The worst of the deaths were those who wanted to share the cake. Without competitors, Didi's discount is pitifully small now, and the taxi cost for users is no different from that of ordinary taxis. The difference is that people are used to online car-hailing, and Didi comes first to mind when they want. Similar examples include the dispute between the princes who ordered food online, and the dispute between Jingdong and Taobao's overlord. In the early stage, they all burned countless money and fought a price war. With the battle of the giants, some small and medium-sized enterprises suffered because they did not have enough funds to support them and died out one after another. This is the tragedy of small and medium-sized enterprises. The power industry is also inseparable from this circle.

We know that the main forms of energy for power production include firepower, water power, wind power, nuclear energy, photovoltaics, etc., although thermal power is restricted to a certain extent due to the need for non-renewable resources such as coal, and pollution and environmental protection., Wind energy, nuclear energy, etc. have received a lot of policy support to encourage development. However, there is no doubt that with the continuous improvement of China's economic level, the absolute demand for electricity will also rise. Due to the limitations of technology, region and other conditions, the energy structure dominated by thermal power generation will not be changed in the next decade or so, and the growth rate of new installed capacity of thermal power will still be higher than that of electricity consumption. According to data, in 2016, my country's thermal power generation totaled 4395.8 billion kilowatt-hours, a year-on-year increase of 2.6 percent, accounting for 74.37 percent of the country's power generation. At present, the discourse power of thermal power generation is basically in the hands of a few big giants. Small and medium-sized enterprises want to continue to share a piece of the pie, and following the price war is purely self-destruction. If you want to occupy a place in the smoke-filled power market, you need to have a long-term vision, clear positioning, pay attention to strategies, comply with national policies, and take customer needs as the leading factor.

In view of the current energy structure form, industry development characteristics, combined with the power industry power generation, transmission, transformation, distribution, electricity consumption five production links,We put forward the following suggestions for small and medium-sized power enterprises：  

1. survival is the first element, as long as a certain amount of production to survive, there will be a comeback.It takes money to fight a price war, and even for some giant companies, it will carry a heavy burden and be difficult to last. It is better to engage in price scuffle than to be wise and to survive the cold winter to wait for the right time;

2. in the field of thermal power giant status has been unable to shake the situation, can avoid its edge, take the opportunity to layout of new energy.It is predicted that by 2066, the installed capacity of China's power system may reach 6 billion kilowatts, with solar power generation as the main form and other forms as auxiliary forms. The market is large enough, the existing situation of thermal power is difficult to break, and the field of new energy is still a blue ocean;

3. adapt to the trend and take the lead in energy Internet.The future power production and marketing must be based on the market