Huaneng to boost capacity on stimulus expectations

Huaneng Power International plans to boost capital spending by 18% this year despite posting its first annual loss in 2008, Bloomberg reported. The company, which is China’s biggest electricity generator, said it may increase spending on plants and equipment to US$4.8 billion in 2009, up from US$4.1 billion the previous year, to meet demand created by the country’s stimulus plan. “Even though China’s electricity output fell in early 2009 because of the financial crisis, demand will continue to increase or the whole year,” said Huaneng Chairman Cao Peixi. The company plans to increase generation to 190 million megawatt-hours this year from 184.6 megawatt-hours in 2008. Huaneng posted a net loss of US$541 million in 2008 due to soaring coal prices – the company’s fuel costs rose 47% – and declining demand toward the end of the year.