R&M costs for Huaneng RE likely to surge 30-40% in 2014

Riding on the back of 2013 growth.

R&M costs for China-based Huaneng RE may experience a 30-40% increase during 2014.

According to a research note from Nomura, the increase of R&M costs will be experienced on the back of 80% y-y growth in 2013 given the expiry of the warranty of the WTGs.

Meanwhile, for Huaneng RE's utilization hours and power output, Nomura noted that during 1H14, the company's utilization amounted to ~1,000 hours, 100 hours lower than 1H13.

The report also said that despite the fact that the wind power output rose 40% y-y in May, given the weak 1Q14 and flat y-y growth in June, overall wind power output growth remained flattish in 1H14.