AI TRENDS | Triple Catalysts Boost Power Sector Outlook, Says CICC

CICC's recent report highlights a positive outlook for the power sector, driven by three key catalysts. According to Jin10, the first catalyst is the higher-than-expected spot and settlement electricity prices, which have led to strong performance in the power sector for 2025 and the first quarter of 2026. The second catalyst is the El Niño phenomenon, which is expected to boost electricity demand and improve precipitation levels. The third catalyst involves enhanced policies supporting the integration of computing and electricity, emphasizing the defensive nature of the power sector amid adjustments in the technology sector. Recently, the National Energy Administration and other departments issued an action plan to promote the mutual empowerment of artificial intelligence and energy, further detailing the development path for computing and electricity integration. This policy is expected to provide significant benefits to the industry. Power companies with 'green electricity direct connection' capabilities or those leading in the eight major computing hub nodes are experiencing a revaluation, driving active performance in the secondary market and leading to significant gains. Additionally, amid the temporary fluctuations in the technology sector, the power sector's high dividends and strong cash flow highlight its defensive attributes.