| As the rapid development of the national economy and people’s living standard, the demand for electricity will continually increase dramatically. To fulfill the growing demand for electricity, the investment in power industry has increased as well in recent years. China Electricity Council expects that the investment will reach5.3trillion RMB during the "Twelve Five" period additional68%growth compared with the "Eleven Five" period. Power industry, as a capital-intensive industry, requires a large sum of money for construction, but raise funds in traditional way cannot totally meet the market requirements, how to raise so large amount of funds in a faster way with the very development of power projects, particularly ingreen power is what we research in the article—Project Financing in power industry.Project financingas an innovative means of financing in international financial markets, has been widely used in many projects all over the world. Project financing was introduced to China in the mid1980’s. After then it has been widely used in some large infrastructure projects, especially the construction of power projects which have been successfully applied in. The various modes of project financing have significantly affected Chinese power project financing and provided a useful reference for China’s utilization of foreign capital in power project. Project financing as an important means of financing should be normally applied and promoted in the Chinese power industry. As we all know, Project finance has a variety of modes, so how to choose a proper mode into application? Besides, with political, economic and environmental constraints, there are still some problems to apply project financing in practice. How to realize these problems correctly, and the fix them in order to make the project financing can be better suitable for the development of China’s electric power industry, is a urgent task we faced and the purpose of this article.In this paper, we chose the combination of theory and case method to research how to choose the proper mode of project financing in power industry. The paper includes a total of four parts:the first part is introduction, mainly introduced the back ground, significance, ideas, study methods and summary of domestic and foreign research. The second part describes the concept and characteristics of project finance, besides the difference with the traditional corporate finance and participating subjects and project financing framework. In the part, the article also described and analyzed several common international and domestic projects financing mode. The third part discusses the current situation of China’s power industry and its development, then recalled the history of project financing in the country’s power industry and at last analyzed how to select the proper mode of project financing. The last part, the paper reviewed the experience of project financing in China’s power industry through two cases Laibin B power plant project and HebeiSaide Power Plant Project, and then addresses the problems and the recommendations for them of the project financing in our country’s power industry.This article studied project financing combined with the power industry striving for some modest contribution to project financing in power industry. However, due to the lack of experience and the limited academic level of mine, for our current problems and project financing proposals mainly from the macro aspects, Micro analysis was much more less, there are still many issues worth to research in this field. |
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