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Analysis on Transformation and Replacement Trend of Power Distribution Equipment


The main application of power transmission and distribution equipment is to control and protect the power system. It is the direct consumer industry of electrical equipment. The investment and development of the power industry directly affect the demand for electrical equipment. In recent years, the government has increased its investment in technological transformation of the power grid, which has played a positive role in promoting the manufacturing industry of complete sets of electrical equipment. Especially during the "Twelfth Five-Year Plan" period, my country's economy and society have shown new phased characteristics. By 2014, The State Grid plans to invest in fixed assets to reach 403.5 billion billion yuan, and the growth rate is close to 20% for the first time. And, after a wave of transmission network investment climax, the construction of distribution network and related equipment investment is bound to usher in a new wave of investment climax, in order to achieve the effect of balanced development of transmission and distribution network.

With the advancement of rural power network transformation, backbone transmission network and other engineering construction, the localization of power distribution related equipment has been driven, the demand for backbone network equipment tends to decline, and the construction of distribution network has begun to enter a period of high prosperity. And distribution network construction, the key task of intelligent power grid forced industry-related enterprises must do the following transformation:

1. Integrated Solution Provider Transformation

The integrated solution requires complete equipment suppliers not only to have product development, production and manufacturing capabilities, but also to design solutions according to the characteristics of the project's objects, and to develop suitable software and other services from front-end design to back-end maintenance. With the basic completion of the construction of power grid transmission network, the demand for power distribution equipment will be a new round of growth point, and the new generation of complete equipment providers require enterprises to use modern electronic technology, communication technology, computer and network technology and power equipment to organically integrate the monitoring, protection, control, measurement and management of the distribution network under normal and accident conditions to carry out long-distance data transmission and monitoring, improve the degree of automation of equipment. Enterprises are required to have a complete system from product design, development, production and sales, from receiving customer orders to the final realization of sales, through program evaluation, design, production guidance, installation testing and after-sales service.

For a long time, the domestic power distribution market is dominated by a single equipment supplier, but with the acceleration of my country's urbanization process, the capacity of the power grid per unit area continues to grow. Miniaturization and customization of equipment have the advantages of saving space, energy consumption and materials, and strong environmental adaptability, which must be the direction of the development of intelligent power grid in the future. The improvement of the stability and reliability requirements of power grid construction will enable enterprises with integrated solutions, strong supporting capabilities and wide coverage to maintain a high market share. Therefore, the one-stop integrated solution service provider represents the future development trend of the industry and adapts to the needs of the private customization of the market.

2. The brand effect highlights

For a long time, China's distribution market is mainly sold through two modes: one is to participate in bidding through the bidding platform of power grid companies. The end users of the industry are mostly power system construction or operation departments, including power companies and their affiliated enterprises, railway, petrochemical, metallurgical and other industry customers, usually by bidding to select equipment, equipment manufacturers to participate in the bidding, according to the bid evaluation rules to determine the winning manufacturer, the two sides signed a technical agreement, the business contract began to implement. The other is based on market research and market supply and demand situation to determine the product gross margin range, combined with product costs to determine the final price range. However, in any way, it will more or less form an interest relationship with the power grid monopoly giant, but with the in-depth development of the industrial service chain, the influence of the brand will definitely change the current business distribution pattern.

In the National Plan for the Adjustment and Revitalization of the Equipment Manufacturing Industry, it is proposed to accelerate the autonomy of equipment, ensure the needs of the project and promote the development of the industry; in the Opinions on Implementing the Decision to Expand Domestic Demand and Promote Economic Growth and Further Strengthening the Supervision of Bidding and Bidding for Project Construction, it is pointed out that except for statutory circumstances such as projects, goods or services that need to be purchased cannot be obtained within China or cannot be obtained under reasonable commercial conditions, domestic brand products should be purchased. The national industrial policy clearly proposes to give priority to the use of domestic independent brand products in the construction of major projects, which provides development opportunities for domestic power grid equipment manufacturing enterprises. With the growth of demand for miniaturized and customized products, the comprehensive brand formed by the technical level, operation performance, product quality, market reputation and after-sales service of the enterprise is the core competitiveness of the enterprise and the key factor affecting whether the enterprise has won the bid.

3. The rise of industry mergers and acquisitions wave

The power industry is a typical capital-intensive industry. When entering the high-growth stage and the industry is transformed and upgraded, the demand for funds will increase, and the financing model will become more important than ever. At present, most of the larger acquisitions and restructurings in the power industry are dominated by state-owned enterprises, with the main purpose of obtaining resources and expanding market share. However, with the completion of the upgrading of the transmission network, the adjustment from scale expansion to structural optimization, the adjustment of asset layout and the adjustment of strategic direction are the focus of future mergers and acquisitions.

According to the report "Global and China's Power Transmission and Distribution Equipment Manufacturing Industry Trends" released by Roland Berger in 2012, the scale of China's power transmission and distribution market will be close to 320 billion yuan by 2015, while there are currently more than 7000 power transmission and distribution equipment enterprises in China, most of which are concentrated in small and medium-sized products and equipment supply fields, lack of standardized management, and there has been a crisis of overcapacity at the low end of the manufacturing industry, and it is difficult to adapt to the needs of intelligent, integrated, complete and overseas industry transformation and upgrading. Accelerating scale expansion through mergers and acquisitions, extending the industrial chain, and finding new profit growth points are the main purposes of the capital operation of industry enterprises. In the face of a new round of industry development trend of high capital barriers, qualification barriers and technical barriers, in the next few years, low-end non customized enterprises will enter the era of low profit, and the industry will enter a new round of reshuffle period. Some non competitive small and medium-sized enterprises will face the fate of being acquired and merged. Only through the depth of the shuffle to eliminate backward production capacity, structural adjustment and transformation and upgrading.

Accelerating the development of urban power grids, improving the power supply network, and improving the power supply capacity is another large-scale power grid investment construction project after the "two-grid transformation. The weak distribution infrastructure, scale and huge market demand make the timely transformation and upgrading of enterprises in the industry can grasp the industry opportunities and achieve leapfrog development.

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