CHINA Huadian Hong Kong (CHDHK) and Bangladesh Power Development Board (BPDB) have agreed to form a JV to build a 1,320MW coal-fired power plant (estimated price: US$2 billion). China Huadian is cutting back on coal in China.

The site is in Moheshkhali island, Cox's Bazar. It is in the extreme south of the country (total installed generation capacity 16,000MW), near the border with Myanmar and 415 kilometres from Dhaka. Local press reported Mohammad Saiful Islam, a BPDB director, as saying that the tie-up will be equally owned by both companies, and that the project will take four years to complete.

Bangladesh uses natural gas for most of its power plants and suffers from electricity shortages. Of the 40,000 MW of generation capacity that Bangladesh plans to have by 2030, nearly half is set to come from coal-fired plants.

China is moving away from coal-fired generation, with China Huadian recently unveiling plans to shut down 14 older coal-fired plants. The company expects to cut coal consumption in 2018, in line with the National Energy Administration's push to reduce pollution. China Huadian is one of the five national power producers that is wholly owned by the state and regulated by the State-owned Assets Supervision and Administration Commission of the State Council.

On 4 May Moody's Investors Service assigned a first time A2 issuer rating to China Huadian Corp Ltd. At the same time, Moody's assigned an A2 senior unsecured rating to a bond offering from China Huadian Overseas Development 2018 Limited, a wholly owned subsidiary of the group. The US$600 million bond offering was priced on 10 May 2018.

Moody's flagged that, among the five big generation companies, China Huadian sports the biggest installed clean energy capacities, which will benefit from the government's initiative to cut emissions. "At the same time, the Baseline Credit Assessment is constrained by the company's high level of financial leverage, the evolving regulatory regime against its core coal-fired power business, a challenging operating environment, moderate exposure to coal mining operations and execution risks in its overseas expansion projects," said Boris Kan, a Moody's vice president and senior credit officer.

Separately, China Three Gorges Corp is offering Euro 9.1 billion (US$10.9 billion) to buy the stock it does not already own in Portuguese electricity generation and distribution company Energias de Portugal (EDP). The offer is subject to Three Gorges holding 50% of EDP voting rights plus one after the bid, the Chinese company stated in a regulatory filing. It holds a 23% stake in EDP.