Research On The Sustainable Development Capability Of Provincial Electirc Power Company Under Chinese Transitional Economy

To be special goods, electric power is not only the engine of economy developmentbut also the necessity of people's daily lives or even their survival. The huge variationon geographic environment and unequilibrium of economic levels in China make itpossible and necessary for local electric power company to survive and develop in vastrural areas where transportation is inconvenient but are rich in water resources. Localelectric power refers to medium or small power stations and their grids, which aresponsored by local government aiming at local rural and county economic development.As an infrastructure industry, local power is crucial to the development of ruraleconomy. However, due to feature of water resource as well as the historical reasons,there are many disadvantages for nearly all local electric power companies such aslacking clear strategy, over-diversification, resource wasting and inefficientmanagement. How to keep on going and develop sustainably has become an urgentproblem for local power companies especially facing with the fierce competition fromlarge state power companies. Combining with theoretical, empirical as well as casestudy methods, this dissertation explores the key problems on sustainable developmentof provincial power company.This dissertation is structured into six chapters. The logic of this research is first toestablish theoretical framework, then to do empirical study on the key factors, andfinally to use a case to explain the practical value of the theoretical framework. Themain contents are as follows:In Chapter1, we give a brief introduction of the whole dissertation, including itsbackground, the purpose and approach of this study as well as the main contents andcontributions. In Chapter2, we devote to the literature reviews on electricity researchand sustainable development of enterprise. Based on the review, this chapter also pointsout the limitation of current literature. Chapter3focuses on the theoretical analysis ofprovincial power company's sustainable development. We first address thecharacteristics of electric power industry from three aspects: electricity goods, powerproducing process and its social feature and then explore challenges they are facing with, which are coming from electric system reform, resource efficient usage andenvironment protection. To further assess the sustainable development capability ofprovincial power companies, we establish Fuzzy Analytical Hierarchy Process model.Based on the realistic assessing results, this dissertation puts forward a"related-core-business" three levels theoretical framework so as to comprehensivelyanalyze the sustainable development of these firms. Furthermore, we elaborate thecore-level analysis, which consists of strategy position, corporate governance andbusiness model.Chapter4empirically studies the three key issues in core-level. For the strategyre-position, we concentrate on the impact of various factors on diversification decisionof local power companies. Our findings suggest that these firms should avoidover-diversification strategy and pay more attention to their main industry to implementfocus strategies. This chapter also empirically explores the corporate governance oflisted local power companies. Finally using objective planning model, we explore thecoopetition relationship between state power companies and local ones. Chapter5is theapplication of theoretical framework. We employ Leshan Electric Power Co.Ltd. as acase to deeply explore its sustainable development in terms of strategy position andcorporate governance. Based on the internal and external environment analyses, we findit currently faces strong competition from dominant state company and emergingprivate firms. Chapter6summarizes the main results in this disseratation and putforwards the further research direction.The main contributions of this dissertation are as follows: First, throught thecomprehensive external environment analysis, this dissertation emphasizes theimportance of sustainable development of provincial electric power companies. We useFuzzy Analytical Hierarchy Porcess to assess the sustainable development capabilitiesof these companies. This dissertation brings forward a new "related-core-business"three levels framework to systematically analyze the sustainable development of localpower companies; second, using listed local power companies as samples, this studyempirically explores strategy position, corporate governance and business models ofprovincial power companies. On the ground of our findings, we suggest that these firmsshould implement focus strategies and use new business model like value-networkmodel; third, based on the above empirical and theoretical analyses, this dissertation employs Leshan Electric Power Co.Ltd to do a case study and make some suggestionson how to reposition their strategies and improve their business models.