China Three Gorges Renewables: Navigating H1 2025 Profit Decline Amid Renewable Energy Market Shifts

China Three Gorges Renewables (CTG Renewables) reported a 5.5% year-on-year decline in attributable net profit to 3.82 billion yuan in H1 2025, alongside a 2.2% revenue drop to 14,735.82 million yuan [1]. This performance reflects broader challenges in China’s renewable energy sector, including supply chain disruptions and seasonal variability in hydropower output. However, a closer examination of CTG Renewables’ operational strategies and long-term projects reveals a resilient business model poised to capitalize on the country’s aggressive energy transition.

Operational Resilience in a Shifting Market

CTG Renewables’ parent company, China Three Gorges Corporation (CTG), has demonstrated financial resilience despite volatile credit risk profiles. From July 2021 to September 2022, CTG’s default probability rose to 1.6%, driven by global post-pandemic disruptions and regulatory pressures on state-owned enterprises. By late 2024, however, its default probability fell to 0.96%, supported by improved debt management and favorable policy frameworks [2]. This credit improvement, coupled with an S&P Global upgrade to ‘A+’ in 2025, underscores CTG’s ability to navigate macroeconomic headwinds [4].

A key driver of resilience lies in CTG Renewables’ diversified renewable portfolio. While its H1 2025 profit declined, its affiliate, China Yangtze Power, reported a 14.22% year-on-year net income increase, driven by a 5.01% rise in hydropower generation from the Baihetan Project. This project, part of a six-cascade hydropower system, offset seasonal declines in the Three Gorges Reservoir, highlighting the company’s strategic focus on dispatchable renewable assets [3].

Long-Term Growth: Capacity Expansion and Strategic Projects

CTG Renewables has outlined ambitious capacity expansion plans, targeting 50,000 MW of renewable generation by 2025 (up from 36,000 MW in 2022) and 30,000 MW by 2030 [5]. To achieve this, the company is investing ¥25 billion ($3.8 billion) in 2023 for solar and wind projects, including a 16 GW multi-energy project in Inner Mongolia (8 GW solar, 4 GW wind, and 4 GW coal-fired power) [4]. This hybrid approach balances renewable growth with grid stability, aligning with China’s 2025 target of 20% non-fossil fuel energy consumption.

Innovation is another pillar of CTG Renewables’ strategy. The company’s dual tower/concentrated solar power (CSP) project in Gansu Province, featuring two 50 MW towers and two 50 MW solar fields, exemplifies its focus on technological optimization. This design aims to enhance solar flux efficiency and reduce optical attenuation, addressing technical challenges in CSP deployment [5].

Policy Tailwinds and Global Ambitions

CTG Renewables’ growth is further supported by China’s Renewable Energy Substitution Initiative and power market reforms, which prioritize system flexibility and renewable integration [6]. The company’s international expansion, including 619 MW of solar projects in Spain and 100% ownership of Alcazar Energy Partners in the Middle East, aligns with China’s global green energy ambitions [2]. These projects not only diversify CTG Renewables’ revenue streams but also position it as a key player in cross-border renewable energy partnerships.

Conclusion: A Strategic Position in the Energy Transition

While CTG Renewables’ H1 2025 profit decline signals short-term challenges, its operational resilience—bolstered by credit improvements, hydropower diversification, and innovative projects—positions it for long-term growth. With China’s renewable energy market projected to grow at a 9.1% CAGR through 2034 [3], CTG Renewables’ alignment with national decarbonization goals and global sustainability frameworks makes it a compelling investment for those seeking exposure to the energy transition.

Source:
[1] Three Gorges Renewables H1 Profit Down 5%, Revenue Slips 2 [https://www.marketscreener.com/news/three-gorges-renewables-h1-profit-down-5-revenue-slips-2-ce7c50d2da8af521]
[2] China Three Gorges Corp. [https://martini.ai/pages/research/China%20Three%20Gorges%20Corp.-4b947337cbccc95e300d95cbe2408ea7]
[3] China Yangtze Power's H1 2025 Performance [https://www.ainvest.com/news/hydroelectric-power-stable-high-yield-investment-china-energy-transition-china-yangtze-power-h1-2025-performance-2508/]
[4] China Three Gorges Corp. Upgraded To 'A+' [https://disclosure.spglobal.com/ratings/en/regulatory/article/-/view/type/HTML/id/3368963]
[5] China's Three Gorges has begun commissioning their dual tower/CSP project [https://www.solarpaces.org/chinas-three-ghosts-has-begun-commissioning-their-dual-tower-csp-project/]
[6] China advances power market reform to support renewable integration [https://climatecooperation.cn/climate/china-advances-power-market-reform-to-support-renewable-integration-and-system-flexibility/]