Huaneng Power International, Inc. Announces 2008 Interim Results

Net Loss Attributable to Equity Holders of the Company Amounts to Rmb544
Million

BEIJING, Aug. 27 /Xinhua-PRNewswire-FirstCall/ -- Huaneng Power
International, Inc. (the "Company") (NYSE: HNP; HKEx: 902; SSE: 600011)
announced today its unaudited operating results for the six-month period ended
June 30, 2008.
(Logo: http://www.xprn.com/xprn/sa/200705141256.JPG )
Consolidated Operating revenues of the Company and its subsidiaries for
the first half of 2008 amounted to RMB30.737 billion (equivalent to
approximately US$4.481 billion), representing an increase of 32.81% compared
to the same period last year. Loss attributable to the equity holders of the
Company amounted to RMB544 million (equivalent to approximately US$79
million).
Loss per share was RMB0.05, or RMB2 (equivalent to US$0.29) for each American
Depositary Share (ADS).
During the first half of 2008, the Company actively dealt with a number of
unforeseeable events including freezing rainstorm, snowstorms and the mega
earthquake disaster in Wenchuan, and strived to overcome the impact of adverse
factors including tight coal supply and a drastic increase in coal prices. All
the staff have done their utmost and struggled tenaciously and achieved new
development in various aspects including production safety, sales and
marketing, energy saving, environmental protection, project development and
capital operation.
On power generation, the Company's power plants within China achieved a
total power generation of 91.448 billion kWh based on a consolidated basis
during the first half of 2008, representing an increase of 13.43% over the
same period last year. Moreover, during the first half of 2008, Singapore Tuas
Power Ltd. achieved a total power generation of 5.042 billion kWh, an increase
of 0.21% when compared to 5.031 billion kWh of the same period last year, of
which 2.786 billion kWh was vested in the power generation of the Company
(from 25 March, the consolidated financial statement date).
As regards cost controls, at the beginning of 2008, coal supply was
extremely tight due to the impact of the rainstorm and snowstorm disaster in
South China, thereby resulting in a larger increase in market coal prices.
Since stocking of coal started in April in preparation for the summer peak
load, the price of thermal coal has risen drastically again. With the
continued rise in spot coal prices, the difference between key contract prices
and spot purchase prices continued to widen. Certain key contract suppliers
also raised the supply prices on top of the substantial price increase in the
key coal supply contracts for 2008. This further increased the difficulty in
controlling purchase prices and brought about tremendous pressure on the
Company's cost control. The Company actively adopted various measures
including adjusting the purchase structure, controlling the purchase volume of
high-price thermal coal, raising the fulfillment rates of high-quality and
low-cost coal, strengthening quality management of coal used in power plants,
appropriately increasing the volume of imported coal, enhancing transportation
efficiency and centralizing verification and settlement, so as to control coal
purchase costs to the greatest extent. The unit fuel cost of the Company's
domestic business for the first half of the year was RMB226.78/MWh, an
increase of 34.03% compared to the same period last year on a comparable
basis.
The Company attached great importance to energy saving and environmental
protection work. All the newly built generating units are equipped with flue-
gas desulphurization facilities and the Company has strengthened environmental
protection renovation work on the existing generating units. During the first
half of 2008, twelve desulphurized generating units with a total generation
capacity of 5,522 MW have commenced operation. As at 30 June 2008, the Company
has installed desulphurization generating units with a total generation
capacity of 24,582MW, accounting for approximately 70% of the controlling
generation capacity of the existing coal-fired units of the Company.
As regards project development and construction, the Company made smooth
progress on its construction projects and preparation work of its power
projects. On 1 July 2008, a 600MW coal-fired generating unit (Unit 5) at
Shangan Power Plant commenced commercial operation. As at 31 July 2008, the
Company's generation capacity on an equity basis reached 36,993MW, with the
controlling generation capacity at 40,389MW. The projects-under-construction
and other proposed projects of the Company progressed smoothly.
As regards capital operation, in the first half of 2008, the Company
completed the acquisition of 100% interest in SinoSing Power Pte. Ltd.
("SinoSing Power"). The operating scale of the Company was further enlarged
and its generation capacity increased by 2,670MW on an equity basis,
representing an increase of 7.9%.
The national economy will continue to grow at a relatively fast pace in
the second half of the year, thus providing a favorable external environment
for the Company. A series of policies and rules on raising electricity tariffs
and restricting coal prices implemented by the State have created conditions
for easing the operating pressure of the Company. Moreover, the successive
implementation of the State's energy saving and environmental protection
policies and the relevant measures will be instrumental in improving the
operating conditions of the Company's energy-saving and environmentally
friendly generating units. At the same time, the Company also faces various
difficulties and challenges. The situation of tight coal supply, surging
prices and declining quality will bring about a drastic increase in the unit
fuel costs of the Company and it is anticipated that the increase in unit fuel
costs of the Company for the whole year will not be lower than that for the
first half of the year. The tightening of the State's monetary policies
resulted in rising borrowing costs for the Company. Given that there is an
increase in the number of newly operated generating units nationwide, the
power supply and demand situation was further eased and the utilization hours
of coal-fired generating units nationwide declined. The Company strives to
achieve an average utilization hours of over 5,500 hours for domestic coal-
fired generating units for the whole year. The State controls the scale of
fixed assets investment and becomes stricter in approving power projects and
puts forward stricter requirements for the development of new projects of the
Company in the future.
The major operation plans for the second half of the year include: to
actively reflect to the State the current operating conditions of the power-
generating sector and to strive for improvement of the operating environment;
to strengthen optimization work of power generation mix; to use the best
endeavours to ensure fuel supply and to strive to enhance the fulfilment rates
of planned contracts and control market purchase prices; to promote energy
saving and emission reduction work in full force and to actively commence
detailed management of energy consumption indices and optimized operation of
generating units; to strengthen internal management and to effectively control
financing costs; to actively push forward preliminary work of projects, to
further optimize power plants structure and to adjust their deployment; and to
strengthen the management of infrastructure construction, ensuring safe,
stable and economical operation of newly operated generating units so as to
meet the requirements of energy-saving and environmentally friendly generating
units.
To view Huaneng Power International, Inc. Financial Statement, please
visit: http://xprnnews.xfn.info/huaneng/20080827/Huaneng_ERN.pdf .
Huaneng Power International, Inc. has a total generation capacity of
36,993MW on an equity basis and a controlling installed generation capacity of
40,389MW. The Company wholly owns sixteen operating power plants, an operating
power company, and has controlling interests in thirteen operating power
companies and minority interests in five operating power companies. Currently,
it is one of the largest listed power producers in China.
For any details regarding the interim results, please refer to the
following websites: Hong Kong Stock Exchange: http://www.hkexnews.com.hk .
The Company: http://www.hpi.com.cn and http://www.hpi-ir.com.hk .

Encl: The unaudited condensed consolidated interim balance sheet and
condensed consolidated interim income statement of the Company and
its subsidiary for the six months period ended June 30, 2008,
prepared under International Financial Reporting Standards.

For enquiries, please contact:

Ms. Meng Jing or Ms. Zhao Lin
Huaneng Power International, Inc.
Tel: +86-10-6649-1856 or +86-10-6649-1866
Fax: +86-10-6649-1860
Email: zqb@hpi.com.cn

Ms. Carrie Lam or Mr. Karl Cheung
Rikes Hill & Knowlton Limited
Tel: +852-2520-2201
Fax: +852-2520-2241

SOURCE Huaneng Power International, Inc.

Ms. Meng Jing or Ms. Zhao Lin of Huaneng Power International, Inc.,
+86-10-6649-1856 or +86-10-6649-1866, fax +86-10-6649-1860, zqb@hpi.com.cn;
Ms. Carrie Lam or Mr. Karl Cheung of Rikes Hill & Knowlton, +852-2520-2201,
fax +852-2520-2241, for Huaneng Power International, Inc.