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Corporate Social Responsibility Report 2011 About This Report

GUANGDONG YUDEAN GROUP CO., LTD. English name: YUDEAN GROUP CO., LTD. Also referred to as YUDEAN GROUP, YUDEAN, the Company or "we" in this report

Timeframe January 1, 2011- December 31, 2011; part of the events do not happen within the of this above timeframe. report

Reporting CSR (corporate social responsibility) report of YUDEAN GROUP means the annual period report which is issued together with the Company's annals. This is the second CSR report issued by the Company.

Coverage The whole Company (see "About us" for the organizational structure) .Unless of the otherwise specified, data and cases in this report are all from GUANGDONG report YUDEAN GROUP CO., LTD. and its affiliate companies, holding (joint stock) subsidiaries, and power generation enterprises.

Interpretation Data in 2011 quoted in this report are the final statistical data. In case they of data disagree with the annals, the latest disclosure data shall govern.

Editing CSR report of GUANGDONG YUDEAN GROUP CO., LTD. is compiled in criteria of accordance with the Sustainability Reporting Guidelines (G3.1) issued by the report the Global Reporting Initiative (GRI); it also complies with the compilation requirement of the Annual Progress Report of Global Compact, and strictly follows the report quality assurance criteria and relevant programs; the report systematically discloses the Company's fulfillment to social responsibilities, and responds to relevant interested parties' concerns to YUDEAN GROUP's operating conditions, economic, environmental and social performance, so as to guarantee its quality, normalization and reliability.

Access to Please visit www.gdyd.com for the electronic edition of the report. the report

01/02 24 Special responsibility report Decade's fulfillment of social responsibility, self- surpassing progress Power guarantee for the Universiade, courageous bearing of responsibility

34 Safe YUDEAN Contents Improve the safety system Intensify work safety Strengthen emergency management Boost safety culture

42 Excellent YUDEAN Realize increase in management efficiency Optimize power structure Readjust industrial structure Widen regional layout

56 Green YUDEAN Dedicated to energy conservation and emission reduction Explore clean-energy Innovate green technology Stick to the low carbon and environment friendly way

05 Address 66 Harmonious YUDEAN 07 Critical Data Attach importance to employees' development Realize win-win cooperation About YUDEAN 09 Combat corruption and uphold integrity 11 Corporate Strategy Pay taxes in conformity with law 13 Corporate Governance Zealous about public benefit activities 16 Organizational Structure 77 Expectations in 2012 17 Involvement of Interested Parties 79 GRI index table 18 Major Social Organizations Involved 83 Third party comments 85 Technical terms 19 Responsibility Framework 21 Social Approval

03/04 Board Chairman Pan Li Director and General Manager Li Zhuoxian

Address

In 2011, the state's 12th five year plan also witnesses its fulfillment of social largest biomass power plant and the largest enlargement, public welfare and charities, began, and also in 2011, YUDEAN responsibility for ten years. PV power station in Guangdong and won aid to the poor and disaster relief and so celebrated its 10th anniversary. In 2011, YUDEAN continued with its the first IGCC power generation project on, and won 2010 Hongmian Bonus of For ten years, we have always been sticking efforts to seek for development despite of with proprietary intellectual property right Poverty Relief in Guangdong; We also to the business philosophy of "harmonious the severe external environment. In that in our country; installed capacity of clean coordinated and paid equal attention to development and pursuance to correct year, we were dedicated to the fulfillment energy increased by 43.8% compared the cares and requirements of all interested path and creation", scrupulously abiding by of social responsibility and promotion of with the Company was founded. We also parties to realize mutual benefits and joint the business mission of "shouldering due the Company's sustainable development as implemented denitration reform and energy development. social responsibility and contributing to the always. conservation optimization and improvement In 2011, we issued the first CSR report whole society", continuously enhancing We strengthened sophisticated management project in subordinate thermal plants, which of YUDEAN, and established its nature the Company's core competence, and have and benchmarking management, and all made great contributions to energy saving to be disclosed as the annals. This year, gradually developed into a super large safety indicators were improved obviously and environmental protection. in the second annals, we mainly present comprehensive energy group with more than compared with the previous year. We We launched a series of activities to the Company's comprehensive fulfillment 100 billion of total assets. We put our mind realized the "two zero accident objectives", celebrate the Company's 10th anniversary, of social responsibility in 2011 and the on building an intrinsic safety enterprise, namely zero personal injury and zero expand YUDEAN's corporate culture, and achievements made. In 2012, we will actively and effectively tackle with all equipment accident, achieved 119.054 intensify the Company's cohesive force and continue abide by the ten principles of burdens and difficulties, and have efficiently billion kwh on-grid electricity, and fulfilled unity, and encouraged employees' career Global Compact, work continuously for guaranteed the power supply for Guangdong the power supply guarantee task for planning and made trial reform in the salary the harmony between "the enterprise, economic and social development; we World University Games, which system. persons, society and environment" are dedicated to "creating green energy were highly praised by the government and We repaid society in many ways, such as to realize the Company's sustainable wholeheartedly", try to build the "Blue the public. participation in community building, job development. Sky Project", energetically carry out clean Despite of the rise of financing cost and production and energy conservation and fuel cost, the Company's business was emission reduction, and have effectively also profitable, and we won excellence protected the ecological environment; in the provincial assessment of national we also pay special attention to develop assets management responsibility system employees' value, actively build the win- for ten straight years. We also bought 50% win mechanism with relevant interested stock rights from INTERGEN together with parties, participate in social benefits and Huaneng Group, which greatly increased charities, and make insistent efforts for the our strength in our main business -power building of harmonious society. We are glad generation. to see the ten-year development of YUDEAN We built and put into operation the world

05/06 Critical Data

Economic Environmental performance indicator performance indicator 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011

Installed capacity Emission of nitrogen oxide MW 19853.2 21053.2 19787.2 21186.7 24809.7 G / kwh 1.36 1.24 1.20 1.29 1.36

Generating capacity Emission of sulfur dioxide billion kwh 95.57 104.461 100.69 104.583 126.647 G / kwh 1.35 1.09 0.47 0.46 0.44

On-grid electric capacity Emission of smoke dust billion kwh 89.55 97.93 94.315 98.186 119.054 G / kwh 0.36 0.17 0.11 0.08 0.07

Total assets Discharge rate of effluent billionYuan 88.891 91.662 105.788 117.713 132.173 % 100 100 100 100 100

Gross operating incomes Desulfurization equipment ratio billion Yuan 34.150 39.580 40.720 43.0 53.427 % 81 98 98 100 100

Equivalent available Desulfurization efficiency factor of generating unit % 91.91 91.20 90.48 89.10 91.20 % 88 95 96 96 96

Labour productivity of 1000 employed staffs yuan/person 2677.9 2890.9 3292.0 3360 4182.8

Social performance indicator 2007 2008 2009 2010 2011

Installed capacity of clean and renewable energies MW 4582.2 4582.2 4582.2 4631.7 4734.7

Taxes and dues paid billion Yuan 5.345 5.484 5.543 5.230 5.368

Collective contract signing ratio % 100 100 100 100 100

Investment in environmental protection million yuan 4131.23 2702.90 1638.76 3458.43 2670.87

Investment to help the poor 1000 yuan 1318 1646.1 1681.1 16303.9 13000

2011 Corporate Social Responsibility Report

07/08 About YUDEAN Enterprise Values ([YOT KY KYY YOT ([ OR ) N U[Y 9NU[RJK UTO XOTM U V S J[ GX Z VUT K \ X R . SKT XKY YOHOROZ_ YU G K RUV IU IOG G \K TZX R R Z K IUXXKIZ UZNK OH[ J ZU Z ]NU ZOT T IK RKY M 9 GT T UI VK K _ [ XKGZOU OKZ I IO XY JI _ UU GR [ GT V Z_ N V N KX  S GZ G K V V ZO LL U OI T Z T O T  K U K Y T U _ O I Y M S ([YO T X X T TK I _ K U Y YY K O T OX KY S U \ OT OY X K Y YOU O \ R T [ N_ T Z O T ( V _ K YU ) G  Y U K OR U T R [ R N \ X N ) U G V G K O Z R[ + T T  K _ K S U N S V K G S L X T U Y U T Q

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Hydro Power Wind Farm Nuclear Power Biomass Shipping Transformer User Photovoltaic LNG Power Thermal Plant Plant Power Plant Station Power Plant Plant Power Plant Distribution map of power plants controlled by Yudean Group

Pannan Power Plant of Guizhou (2400MW) TSQ-1 Hydro Power Plant of Guizhou (1200MW) Nanshui Hydro Changtan Hydro Power Plant Power Plant (75MW) (60MW) Fengshuba Hydro Qingxi Hydro Power Plant Power Plant Power Plant (520MW) (160MW) (144MW) Power Plant Yangshan (600MW) Power Plant Meixian Penglatan (135MW) Power Plant Hydro Power Changhu Hydro Liuxihe Hydro (270MW) Plant (44MW) Power Plant Power Plant (76MW) (50MW) Shibeishan Wind Solar PV Power Xinfengjiang Hydro Plant in Guangzhou Farm Power Plant (100.2MW) College Area(3MW) (335MW) Huangpu Power Plant Pinghai (600MW) Power Power Plant (2000MW) Plant Shangjiao A Power Huilai (600MW) Plant(1240MW) LNG Power Plant Power Plant (1200MW) (1170MW) Power Plant (2520MW) Qianwan LNG Power Plant Shangjiao C (270MW) Power Plant Power Plant (1170MW) Jinwan Power Plant (1980MW) (1200MW)

Zhuhai Power Plant (1400MW) Power Plant (500MW)

Zhanjiang Zhangjiang Power Plant Biomass (1200MW) Power Plant (100MW)

Yangqian Wind Farm of (49.5MW)

Thermal Hydro Wind Farm LNG Power Biomass Solar PV Power Plant Power Plant Plant Power Plant Power Plant Corporate Strategy Energy conservation and emission reduction planning during the 12th Overall development strategy: five-year plan period Focus on energy source and facilitate the co-development of Take such measures as adjustment of the power structure, implementation of major projects in energy relevant industries; root in Guangdong and face to the south; conservation and emission reduction, strengthening explore the international market, and build the first class of technical breakthroughs, application of new domestic energy source group with international competence. technologies in energy conservation and emission reduction, and deepening of the sophisticated management of energy conservation and emission Overall development reduction and so on, and try to fulfill the following idea during the aims in 2015: the average coal consumption for 12th five-year plan period power supply is 25 g/kwh lower than the state Strengthen and enlarge major standard value; service power consumption rate is controlled at about 5.43%; emission intensity of businesses and further promote sulfur dioxide is controlled at 0.4 g/kwh; emission the Company's sustainable intensity of nitrogen oxide is controlled at 0.2 g/kwh; development; implement the and emission intensity of smoke dust is controlled strategy that focus on energy at 0.059 g/kwh; and finish the construction of source and facilitate the co- denitration project in all thermal power plants, and development of relevant industries, pollutant emission reach the state and further improve the upstream local standards and the gross amount and downstream industry control requirement. chains, and forge five business sectors including resource, logistics, communal products, environmental protection and finance service; implement the strategy of "going global" and explore the overseas market; gradually push the core operating assets to the market and improve the securitization proportion of the Company's capitals.

Relevant diversified development program during the 12th five- year plan period Core business plans Implement the strategy that focus on energy during the 12th five-year source and facilitate the co-development of relevant industries, further improve the plan period upstream and downstream industry chains, Give priority to the development of and forge five business sectors including thermal power, fully participate in nuclear resource, logistics, communal products, power development and construction environmental protection and finance of Guangdong Province, speed up the service centering on the power generation development of renewable energies like plate; Make adjustments to assets structure, wind power and hydropower, work hard give priority to the optimization and to broaden the development space outside integration of shipping sector, and actively Guangdong and in overseas areas while explore overseas projects. ensure that the power generation property set up during the 11th five-year plan period can generate economic benefits. Further promote the sustainable development of the Company through strengthening and enlarging the major business of power generation. 11/12 Governance Structure

Senior Management of the Company

Governance structure Shareholder Structure Guangdong Provincial Government

As the first company that has realized the diversified property of Guangdong SASAC system, YUDEAN GROUP, in accordance with Pan Li Li Zhuoxian the requirement of modern enterprise system, Board Chairman Director, General Manager establishes the corporate governance structure and rigorous organizational structure composed of the board of shareholders, board of directors, board of supervisors and senior management, and improves the "three-important and one- large" decision system that decision of important matters, appointment and dismissal of important leaders, arrangement of important projects and use of large amount of funds shall all be decided through collective consultation. Board Chairman is the legal representative of the Company, and China Huaneng Group Hong Rongkun Liu Qian Zhong Weimin Guangdong SASAC designates supervisors to the Company. The Company exerts all efforts Director, Deputy General Director, Deputy General Director, Chairman of the to support and assist the job of the board of Manager Manager Labor Union supervisors, and operates in accordance with law to maintain and increase the value of Governance Structure national asset and guarantee the interest of all shareholders of YUDEAN GROUP. All the wholly owned or holding companies of YUDEAN Board of shareholders GROUP also establish the governance structure with "three boards and one management layer" according to the requirement of the Corporation Law. Board of supervisors Board of directors Gao Shiqiang Kong Huitian Li Mingliang Director, Deputy General Chief Economic Engineer Deputy General Manager Manager, General Management team Counsel General Affairs Department General Affairs HR Department Department Strategy and Development Finance Department Safety Supervision Department Production Technologyand Department Operation and Management Department Legal Affairs Capital Operations and Department Auditing and Supervision Corporate Culture Department PartyDepartment- Affairs Labor Union

Xu Ping Zhu Dejun Yang Xinli Deputy General Manager Deputy General Manager Deputy General Manager

In 2011, for the purpose of strengthening capital operation, asset- )UXVUXGZK9UIOGR backed securitization and overall risk management, the Company  8KYVUTYOHOROZ_8KVUXZ headquarters' Board and Legal Affairs Department was changed to Capital Operations and Legal Affairs Department, and the department's function is also adjusted and enriched correspondingly. 13/14 Organizational Structure Relevant Committees of the Company

Work Safety Commission By the end of 2011, YUDEAN GROUP had already had 102 wholly owned, holding, and Construction and Organizational Structure of Work Safety Management System direct joint stock enterprises, including 28 wholly owned enterprises, 21 direct holding companies, 36 indirect holding companies, and 17 direct joint stock companies. Emergency leading group for dealing with large-area power-cut Leading group for the Company's capital construction, overhaul and technology reform projects Leading group of the Blue Sky Project Organizational Structure(chart of wholly owned, holding and primary joint stock companies) Leading group of flood, drought and wind prevention Budget and examination management committee Holding Ruyuan Yao Autonomous County Nanyuan Hydropower Development Co., Ltd. Shaoguan Power Plant Holding Guangdong Jiaoling Changlong Hydropower Co., Ltd. Leading group of information construction Maoming Heat & Power Plant Wholly owned subsidiaries Guangdong Yudean Xinfengjiang Power Generation Co., Ltd. wholly Upper Horn Ocean Transport Co., Ltd. Holding Guangdong Lianzhou Yuelian Power Award and evaluation committee of science and technology owned Upper Horn Orient Energy Transport Plant Co., Ltd. Guangdong Yudean Fengshuba Power Generation Co., Ltd. Co., Ltd. Yudean Investment Co., Ltd. Guangdong Yudean Qingxi Power Generation Co., Ltd. Upper Horn Mingzhu Energy Transport Hengda Energy Developments Emergency treatment mechanism of network and information safety Co., Ltd. Co., Ltd. Guangdong Yudean Nanshui Power Generation Co., Ltd. Upper Horn Energy Transport Co., Ltd. Leading group of staff training Upper Horn Investments (Australia) Guangdong Yudean Changhu Power Generation Co., Ltd. Limited Upper Horn Ocean Transport Co., Ltd. Leading group for standardizing shareholding and investment of state-owned enterprise's employees Guangdong Yudean Changtan Power Generation Co., Ltd. Yet Tact Co., Ltd. Guangdong Yudean Liuxihe Power Generation Co., Ltd. Leading group of open plant operations Dabu Meijiang Penglatan Hydropower Co., Ltd. Holding Guangdong Sea Transportation Co., Ltd. Leading group of incorrupt party Guangdong Yudean Changyuan Power Generation Co., Ltd. Upper Horn Investments Limited wholly Mingyuan Holiday Holding Guangdong Guanghope Power Co., Ltd. Leading group of open party work owned Village Co., Ltd. Guangdong Yudean Huaqing Gasification Guangdong Power Development Company Guangdong Yudean Zhanjiang Biomass Combined Cycle Generation Co., Ltd. Power Generation Co., Ltd. Guangdong Yudean Xinhui Power Generation Leading group for dealing with petition letter and visit to people Guangdong Shajiao (Plant C) Power Generation Corporation Co., Ltd. Guangdong Yudean Faneng Investment Co., Ltd. wholly Leading group of youth civilization and post expert activities owned Zhuhai Tourist Hotel Co., Ltd. Yudean International Development Co., Ltd. HoldingGuangdong Port Co., Ltd. Guangdong Yudean Environmental Protection Co., Ltd. Leading group of family planning work wholly Guangdong Yudean Eco-friendly Material Co., Ltd. owned The second committee of employees' technological association Committee for retirement and resignation management Guangdong Electric Power Development Co., Ltd. wholly Guangdong Yudean Anxin Power Repair Holding Guangdong Shaoguan Yuejiang Power Guangdong Red Bay Power Generation Co., Ltd. owned and Installation Co., Ltd. Generation Co., Ltd. Secrets Office Guangdong Yudean Bohe Coal-fired Guangdong Yudean Humen Power

YUDEAN GROUP Guangdong Huizhou Pinghai Power Plant Co., Ltd. Power Co., Ltd. Generation Co., Ltd. Guangdong Yudean Jinghai Power Policy research and steering committee Guangdong Huizhou Natural Gas Power Generation Co., Ltd. Generation Co., Ltd. Guangdong Yudean Oil Shale Power Guangdong Power Industry Fuel Co., Ltd. Branches Guangdong Electric Power Development Generation Co., Ltd. Insurance leading group Co., Ltd. Shajiao A Power Plant Yunnan Guangdong Yudean Zhanjiang Wind Power Guangdong Yuelong Power Generation Co., Ltd.

Holding companies Branch Generation Co., Ltd. Sports association Guangdong Yudean Finance Co., Ltd. Guangdong Yuejia Electric Power Co., Ltd. Maoming Zhenneng Thermal Power Co., Ltd. Guangdong Yudean Shipping Co., Ltd. Zhanjiang Electric Power Co., Ltd. Zhanjiang Zhongyue Energy Co., Ltd. Guangdong Yudean Western Investment Holding Co., Ltd. Guangdong Yudean Shibeishan Wind Energy Development Co., Ltd. Holding Shenzhen Tianxin Insurance Brokers Co., Ltd. Guangdong Yudean Yunfu Power Plant Co., Ltd. Holding Guizhou Yueqian Power Co., Ltd. Guangdong Yudean Yunhe Power Generation Co., Ltd. Feedback on Performance wholly Yunfu Jinhui Power Service Co., Ltd. Guangdong Yudean property Investment Co., Ltd. owned

Guangdong Yudean Thermal Power Plant Co., Ltd. wholly Guangdong Yudean Information Holding Guangdong Yudean Property Management Co., Ltd. owned Technology Co., Ltd. Guangzhou Fangneng Catering Management Co., Ltd. State-owned Assets Supervision and Administration Commission of Guangdong Province will organize annual and on-duty Guangdong Yuehua Power Generation Co., Ltd. examination to the major managerial staffs of YUDEAN GROUP, and check their operating performance and determine their salary Guangdong Yueyang Power Generation Co., Ltd. wholly Guangzhou Huangpu Power Engineering Co., Ltd. Inner Mongolia Yudean Menghua New Energy Co., Ltd. standard according to the completion of total profits, return on equity, power generation amount, value maintenance and increase owned Guangzhou Huangpu Guangdian Petroleum Storage and Transportation Co., Ltd. Guangzhou Huangpu Yuehua Power Generation HR Resources Co., Ltd. ratio of national asset, overall labor productivity, coal consumed for power supply, and energy conservation and emission reduction Shanxi Yudean Energy Source Co., Ltd. The Company signs economic responsibility agreement every year with its branch companies and subsidiaries and controlled Shenzhen Guangqian Electric Power Co., Ltd. Holding Guangdong Zhuhai Power Plant Co., Ltd. companies, and decides their total annual salary according their fulfillment of examination indicators. Tianshengqiao-I Hydro-power Development Co., Ltd. GGuangdong Zhuhai Jinwan Power Generation Co., Ltd. The Company's director also signs asset management (project management) and work safety responsibility agreement with the Zhuhai Special Economic Zone Guangzhu Power Generation Co., Ltd. superintendents of its branch companies and subsidiaries as well as subordinate companies, and assesses the performance and awards and punishments of the superintendents and determines their salary standard according to the examination results. Joint stock companies The branch companies and subsidiaries, and grass-roots enterprises of YUDEAN GROUP also organize examinations on the North United Power Corporation Guangdong Natural Gas Grid Co., Ltd. Shenzhen Dapeng LNG Co., Ltd. economic responsibility and three other responsibilities of their respective controlled (affiliated) enterprises and internal departments Dongfang (Guangzhou) Heavy Machinery Co., Ltd. Guangdong Ocean Shipping Co., Ltd. Yangjiang Nuclear Power Co., Ltd. according to the above methods. Guangdong Dapeng LNG Company Ltd. Guangdong Zhuhai Golden Bay LNG Co., Ltd. China (Taiyuan) Coal Transaction Center Co., Ltd. Guangdong Guohua Yudean Taishan Power Generation Co., Ltd. Guangzhou Zhujiang Natural Gas Power Plant China Insurance Brokers Co., Ltd.

Guangdong Haidian Shipping Co., Ltd. Guizhou Beipanjiang Power Co., Ltd. Sino-foreign Shaoguan D Power Plant Co., Ltd.

Guangdong Shaoguan No. 9 Generating Unit Joint Venture Co., Ltd. CSPG Comprehensive Energy Co., Ltd. Branches

Shajiao C Power Plant, Zhuahai Power Plant, Beijing Office, Yunnan Office, Nuclear Power Office, Solar Power Branch Company

15/16 Involvement of Interested Parties Major Social Organizations Involved (industrial organization)

Major industrial organizations involved Company role

Energy Law Academy of China Law Society Director unit

China Enterprise Confederation, China Enterprise Directors Association Membership unit "DUJPOTBOE QFSGPS China Electricity Council Deputy director unit NBO DF Electricity Branch of China Water Resource Electricity Quality Control Association Vice-chairman unit Power Generation Committee of Electricity Branch of China Water Resource Electricity Quality Control Association Vice-chairman unit Improvement PODFSOTBO $ EFYQF UPUIF$ DUB Chinese society of Electrical Engineering Director unit PNQB UJP of communication and OZ OT  China Engineering Cost Management Association Power Committee Deputy directing committee unit cooperation mechanism, practical and realistic disclosure of the Company's relevantEffective information revenues, operating post, total amount of tax Thermal Power Generation Branch of Chinese Society for Electrical Engineering Member unit energy conservationinstalled capacity, communication,depth cooperation in- supply of energies, sustainable, healthy and stable development, energy conservationabatement indicators PNN and emission abatement,lawful taxpaying, management safe and stable Scale of $ VOJDBU Nuclear Electric Power Generation Branch of Chinese Society for Electrical Engineering Standing director unit News J and emission and PO of laws and disciplines, innovation, job enlargement Power Engineering Economy Committee of Chinese Society for Electrical Engineering Membership unit Obedience propaganda,company press conferenceannals, regulations, policy proclamation issuance, relevant meetings, work China Electric Power Equipment Management Association Standing director unit form,report, information statistical Observance Laws and visit submission,to higher Joufsf management China Nuclear Energy Association Standing director unit tuf Contributions e development qbs to organizational rules, JB uj E FE ft involved, pushing N ( of membership fees paid to the organizations O  China Tendering & Bidding Association Membership unit effectdevelopment to industrial and B E P Involvement  T O W social to meetings

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Signing ratio of collective collective of ratio Signing personnel, personnel,

reduction of operating operating of reduction

efficient operation standard, standard, operation efficient

meetings, contact contact meetings,

of business business of of labor protection supplies, work work supplies, protection labor of

enrollment to labor union, rate of of rate union, labor to enrollment

report, report, employee turnover, handout ratio ratio handout turnover, employee

contract, establishment of rational rational of establishment contract,

Annual Annual

development training, possibility of trouble, ratio of of ratio trouble, of possibility training,

agreement, agreement, letters, daily business business daily letters,

shareholders' interest, interest, shareholders' daily exchange exchange daily

contractual contractual

salary system, investment in employee employee in investment system, salary exchange

and and

execution of of execution Guangdong Society for Electrical Engineering Deputy director unit signing and and signing

documents and and documents

negotiation, negotiation,

tendering, tendering,

Bidding Bidding

and communication, communication, and

exchange of of exchange

Guarantee of of Guarantee protection

investment, rate of of rate investment,

relevant meetings meetings relevant contractual agreement, agreement, contractual

profit, income on on income profit,

environmental environmental Guangdong Provincial Association for Science and Technology Membership unit

propaganda of of propaganda activities, activities,

return and service and share, corporate corporate share,

execution of of execution

and cooperation, cooperation, and

technology technology and charitable charitable and

heat, relevant relevant heat,

public benefits benefits public

exchange exchange

investment in in investment Guangdong Provincial Association of Work Safety Supervision and Management Standing director unit

energy and and energy

Market Market

Business Business

construction, construction,

Civilized Civilized

Establishment Establishment supply of electric electric of supply company creditworthiness company

agreement, agreement,

contract implementation ratio, ratio, implementation contract

of contractual contractual of

strategic cooperation areas cooperation strategic

and compliance operation, operation, compliance and protect the common benefit benefit common the protect of stable and long-term long-term and stable of

creditworthiness Guangdong Province Tendering & Bidding Association Standing director unit

Execution Execution reciprocity and mutual benefit, benefit, mutual and reciprocity

cooperative relationship, lawful lawful relationship, cooperative Copies Copies

promise keeping, resource sharing, sharing, resource keeping, promise

operation, sincerity and and sincerity operation,

and bid bond bond bid and Guangdong Coal Transportation and Sale Society Vice-chairman unit for cooperation, cooperation, for living environment living

of contract, time limit limit time contract, of community, favorable favorable community,

Lawful Lawful

of harmonious harmonious of

Safe and and Safe

product price product

production, construction construction production,

environment friendly friendly environment Guangdong Enterprises Association for Foreign Economic Cooperation Vice-chairman unit

return on investment on return execution of contract, contract, of execution

implementation ratio, ratio, implementation stable supply, honest honest supply, stable

Safe and and Safe

share, contract contract share, Guangdong University Graduates Employment Association Standing director unit

charities and public benefits public and charities

implementation

Market Market Guangdong Research Society for Employees Ideological and Political Work Vice-chairman unit construction, investment in in investment construction,

price, power of contract contract of power price,

investment in community community in investment

Investment Investment etc. rationality of product product of rationality etc.

and environmental protection, protection, environmental and in emission abatement abatement emission in

capacity, coal, natural gas gas natural coal, capacity, Guangdong Research Society for State-owned Enterprises Party Construction Vice-chairman unit

thermal energy, hauling hauling energy, thermal

stable supply of electric energy, energy, electric of supply stable Computer Information Network Security Association of Guangdong Provence Director unit Safe and and Safe

Guangdong Institute of Internal Audit Director unit

17/18 Responsibility Framework

Realize employees' value Fulfill customers' expectations

thinking of danger in safety strive for the best Excellent Bear social responsibilities Shouldering due Create wealth for shareholders Safe YUDEAN YUDEAN social responsibility contributing to the Harmonious Green YUDEAN whole society YUDEAN low carbon future work hand in hand to grow together

Take responsibility for each kWh

We devote ourselves to the energy industry, pursue the harmony and unity of responsibility, benefit and environment, ensure the power supply to the whole province and provide reliable driving force for social development and create harmonious value for interested parties. Guided by this business mission, YUDEAN GROUP targets at "safety, excellence, green and harmony" to fulfill the social responsibility, fulfill its duty in economy, environment and society as a Cooperation corporate citizen, realize the win-win situation of enterprise development and social Efficiency harmony to make contributions to the development of domestic and overseas areas where the Company's businesses develop and build its image as a responsible global corporate citizen.

Specialty Sincerity

Core value

Concentrate on fulfillment of responsibilities and create happy life 19/20 Social Approval

YUDEAN GROUP has achieved excellence for ten successive times in the examination of province-owned Yuehua Power Generation Company won the titles of National Model Workers Home, and its development and national asset operating performance organized by Guangdong SASAC. application of integrated management software platform for quality, safety, health and environmental protection The Way to Excellence — Outline of Corporate Culture of YUDEAN GROUP won 2010-2011 National of power generation enterprise was evaluated as the "major project of integration of informationization and Corporate Culture Outstanding Achievements Prize. industrialization" by the Ministry of Industry and Information Technology. YUDEAN GROUP was awarded 2010 Hongmian Bonus of Poverty Relief in Guangdong. Ocean Shipping Company was awarded as Safety & Good Faith Company by China MSA. Fourteen of its management achievements won 2011 National Prize for Corporate Management Innovation Power Generation Department of Xinfengjiang Power Company won the title of Nationwide Workers Vanguard; Achievements in Power Industry. Relay Protection Squad of Equipment Department and Instrument Squad of Chemical Branch, Operation YUDEAN GROUP has won the title of Outstanding Enterprise for Preparation of Statement of Final Accounts Department of Shajiao A Power Plant, and Thermal Control Maintenance Branch of Repair Department, Zhanjiang for nine successive years, ranking the first among province-owned companies. Power Company won the title of Guangdong Workers Vanguard. Archiving work of YUDEAN GROUP won excellence for six successive times in archiving assessment of Yuelong Power Generation Company won the title of National Advanced Group for Training of Work Safety Guangdong Province. Supervisors. Guangqian Power Company, Shajiao A Power Plant and Shajiao C Power Plant won the Prize of Advanced Shajiao A Power Plant and Zhanjiang Power Company won the title of Excellent Employee Study of National Union. Entity of Power Supply Guarantee for the Universiade awarded by the State Electricity Regulatory Commission. Shajiao A Power Plant, Guangqian Power Company and Zhanjiang Power Company won the title of 2010 Advanced Yuelong Power Generation Company and Jinghai Power Generation Company were awarded as National Entity of All-people Fitness Activities. Civilized Entity. Zhuahai Power Plant and Changtan Power Company won the title of Guangdong 2010 Work Safety Advanced Unit. Shajiao A Power Plant, Zhanjiang Power Company, Red Bay Power Generation Company and Yuejia Power Zhanjiang Power Company won the title of 2011 Outstanding QC Group of Guangdong Power Sector Company won the title of "Excellent Enterprises in National Power Industry". Pinghai Power Plant was awarded as 2010 Model Team in Labour Emulation of Ten Projects of Guangdong. Huizhou Natural Gas Power Generation Company won the National Quality Award in Power Sector. Shajiao A Power Plant, Zhanjiang Power Company, Red Bay Power Generation Company and Xinfengjiang Power Shajiao C Power Plant, Yunfu Power Plant, Maoming Power Plant, Yuelong Power Generation Company and Company won the title of 2010 Guangdong Best Credit Enterprise. Jinghai Power Generation Company won the title of Winner of National Ankang Cup Competition in 2010. Shajiao A Power Plant won the titles of National Customer Satisfaction Enterprise, National Enterprise with Harmonious Labor Relations and 30 Most Competitive Enterprises in Guangdong in 2010. Red Bay Power Generation Company won the titles of National User Satisfied Company in the Power Industry, 2011 National Advanced Enterprise in Executing Performance Excellence Model in the Power Industry, National First Prize for Equipment Management Innovation in Power Industry and Outstanding Achievements Prize in Informatization of Power Industry during the 11th Five Year Plan Period. Huizhou Natural Gas Power Generation Company became the first national AAAA Well Standardized Power Generation Enterprise and won the title of 2011 Guangdong Representative Enterprise for Independent Innovation. Yunfu Power Plant won the titles of National Advanced Group for Power Engineering Pricing and Quota Information and Guangdong Contract-honoring and Credit-keeping Enterprise.

Corporate Social Responsibility Report Special Responsibility Report Installed capacity MW Decade's fulfillment of social responsibility, 24809. 7

self-surpassing progress 21186. 7 21050 19850 14690 19780 For the ten years since YUDEAN GROUP was founded, it has always been sticking to the scientific outlook on development; it 11720 explores advanced management philosophy and model through deepening its internal reform, and quickens its steps in changing 11090 its development mode; it builds scientific, reasonable and market-standard satisfied modern enterprise management & control 10660 10490 mechanism, forms a development pattern with power generation as its major business and the relevant diversification businesses developing together, and has gradually become the most powerful government owned power generation enterprise under the direct management of Guangdong province.

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Responsibility comes first; stabilize power generation and guarantee power supply Taxes paid

The 32 subordinate power plants of YUDEAN GROUP cover the whole Guangdong province and extend through to Guizhou; billion yuan among them, 13 power plants have realized over 1000MW installed capacity, becoming the main power force supporting the power grid and supply in Guangdong. In recent years, despite of the severe business environment in which coal price and freight 5 . 543 charges rise sharply, we have always been sticking to the responsibility first principle, realized standardized management and 5 . 345 5 . 484 5 . 368 5 . 23 efficient operation to provide safe and reliable power for the economic and social development of Guangdong, and performed our duties concerning economy, society and environment. Since 2003, with the increasingly harsh power supply situations, we 4 . 28 have always been exerting our greatest efforts to power generation and over-fulfill the electricity output index given by Guangdong 4 . 257 4 . 113 3 . 782 Development and Planning Commission every year, which effectively relieves the increasingly tense power supply in Guangdong; 3 . 499 we have successfully fulfilled the tasks of power supply guarantee for important events and disaster resistance, which is highly approved and recognized by the government and public; we win excellence in the province-owned national assets operation performance assessment for ten straight years, and our asset quality and company creditworthiness are in the front ranks of power generation enterprises in our country.

Operating revenue 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 billion yuan 53. 427 Total assets 40. 72 43 billion yuan 39. 58 34. 15 132. 173 25. 54627. 292 117. 713 22. 803 105. 788 19. 875 91. 662 19. 05 88. 891 83. 53 72. 064 63. 095 59. 859 58. 224 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Power Generation Amount 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 billion kwh 126. 647 104. 58 104.46 100. 69 95. 57 76. 46 68. 34 66. 52 Corporate Social 62. 27 52. 55 Responsibility Report

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 25/26 Optimize corporate structure and realize diversified development

With the strategy of "centering on energy and facilitating the co-development of relevant diversified industries", YUDEAN GROUP has basically formed a new pattern centering on energy, extending to the upstream and downstream industries, and encouraging the main business to drive the development of the relevant diversified businesses. It invests in the coal mine industry, speeds up the development of shipping industry, participates in the construction of LNG receiving station and the main natural gas grid in Guangdong province. Its overall power structure, regional layout of power and industrial structure are more scientific and reasonable.

Case The power structure is increasingly improved In January 2008, severe snow storms hit southern China. It exerts great efforts in building large capacity, high efficiency and low energy consumption generating units and at the same YUDEAN GROUP put all efforts to ensure coal supply for time puts desulfurization facilities into production. For ten years, it has put into production large capacity, high efficiency and power generation, took emergent steps in generating power environment friendly generating units with 13100MW installed capacity, which provides great energy guarantee for the economic with full output to ensure the power supply, and guaranteed and social development of Guangdong. So far, its generating units with 600MW single capacity and above have taken up 50% power supply in the whole province with its installed 56.03%, which brings YUDEAN GROUP with both reduction of energy consumption and pollutant discharge and improvement capacity taking up less than 30% of the province total. of production capacity; Its low-efficiency and heavy pollution generating units have been gradually wed out, and 1,645MW small generating units were shutdown during the 11th five-year plan period. It actively develops renewable energy and new energy, and form a new pattern with low carbon clean energy including "wind energy, biomass energy, hydro power, natural gas, solar energy and nuclear power". At present, clean energy has taken up as high as 19.08% of the total energy in YUDEAN GROUP.

The industrial structure becomes diversified IWe stick to the scientific outlook on development, take effective measures to facilitate the change of development mode, and optimize the industrial structure scientifically, and change the past single power generation structure to the present new industrial pattern which centers on power and emphasizes the co-development of the relevant industries covering coal mine, shipping, port, natural gas receiving station, cogeneration, equipment manufacturing industry and finance industry, and have made favorable achievements. We have effectively reduced the production operation cost, prevented the market and financial risks, and our control over resources has been further strengthened. Make reforms and innovation efforts, and take good measures in managing and acting Regional layout tends to equalize gradually We actively respond to Guangdong government's harmonious regional development strategy, and make reasonable regional layout for our power structure and industry. Taking advantage of the coastal port, we build a batch of 1000MW level super large coal-fired power plants in the We exert great efforts in management innovation, and build the industrially advanced "YUDEAN generation management model" and east and west edges, "replace the small generating units with the big ones" and reform and expand old plants in northern and through strengthening the Company's information construction, carrying out the "integrated" management system, and exploring eastern mountainous areas of Guangdong, and build some economical and environment friendly coal-fired units which can adapt and building the strategic business units, and further clarify the management boundary and optimize the operation flow; we are to the local conditions, which are great contributions to the safe operation of power grid and optimization of power distribution in dedicated in building a standard corporate governance structure, and become the first province-owned company in the province Guangdong. which realizes diversity of equities in the Group's management layer. Now the Company's board of shareholders, board of We take an active part in the development of the west regions, invest in coal mine, thermal power and hydro power development directors, board of supervisors and management all work normally, scientifically and efficiently; the corporate governance structure and construction projects, and widen the development space and global industrial layout through stable capital operation. Upper is gradually mature, the Company's supervision and management system has been enhanced, and it's regarded as a good example Horn Company subordinate to YUDEAN GROUP has realized its participation in Australia coal mine formally, and the Company by Guangdong SASAC for deepening state-owned-enterprises reform in Guangdong. successfully bought 50% stock rights of InterGen together with Huaneng Group.

Emission of sulfur dioxide Case Installed capacity In 2010, the 16th Asian Games and the 10th Asian Para Games were held in Guangzhou. As the largest power generation enterprise 案 例 in Guangdong, YUDEAN GROUP shouldered the important task Rises to the current 24809.7 MW from 4.48 g/kWh at the beginning of of guarantee of power supply with strong sense of mission and its establishment consciousness of responsibility. It mobilized about 16000MW of unit capacity and guaranteed the power supply and safe and stable operation of power grid during the Asian Games. Besides, in order to ensure the water supply safety for the Asian Games, 5 reservoirs of the Company's hydraulic power plants transferred 3.8 billion m3 water for the Asian Games, resulting in a loss of electricity quality of from MW at the beginning of Drops to the current g/kWh about 10.75 million KWh., which leads to a direct economic loss of 8610 its establishment 0.44 3.54 million yuan.

27/28 Low carbon objective, pioneer in green life

We stick to the philosophy of "creating green energy wholeheartedly", and take the lead in carrying out the Blue Sky Project which focuses on flue gas desulfurization of coal-fired power plants in the whole country, becoming the first domestic power generation Power Guarantee for the Universiade enterprise of which the power plant generating units have realized desulfurization operation. Discharge rate of sulfur dioxide has dropped to the current 0.44 g/kWh from 4.48 g/kWh at the beginning of its establishment. We are dedicated to the development Courageous Bearing of Responsibility and production of clean energy. The biomass power generation unit of YUDEAN has the world largest single capacity; the Company also has five CDM projects of the U.N., showing that the Company's contributions to slow down global warming have been approved by the international world. In response to the requirement of energy conservation and emission reduction, we insist on technology innovation, focus on energy conservation, emission abatement and consumption reduction, continuously increase the application of new technologies and techniques, and encourage clean production and circular economy in an overall way, and the main consumption indices and discharge indices decline year by year. Now we are implementing phase-2 project of the Blue Sky Project, and equip the currently in-service coal-fired units with denitration devices to reduce the discharge amount of nitrogen oxide. In August 2011, the 26th World University Games were held in Shenzhen. More than 12000 athletes and technical officials from 152 countries and regions attended the Games, making the Games the largest Issue the annual report for the first time to show one in scale. The Universiade is another our fulfillment of social responsibility international integrated sports meeting held following Beijing Olympic Games and Guangzhou Asian Games in China. Holding On July 13, 2011, YUDEAN GROUP issued its CSR report of 2010, of the games is also an overall assessment which is the first CSR report issued by the Company directly under the to the infrastructure, energy guarantee and control of Guangdong government as well as the first CSR report issued resource supply of the host city. by YUDEAN. The report elaborates on how YUDEAN GROUP, as the The largest power generation enterprise largest province-owned power generation enterprise in Guangdong, in Guangdong, YUDEAN GROUP, takes sticks to the scientific outlook on development, insists on the sustainable the successful power guarantee for the development philosophy, and shouldering responsibilities in work Universiade as its important political safety, operation management, green and environmental protection, responsibility and social responsibilities, and social harmony, and systematically demonstrates the economic, and exerts all its efforts and shoulders the environmental and social performance of the Company with detailed responsibility for main power supply. Check the equipment carefully to guarantee safe power supply data and rich cases.

Concentrate excellent resources to serve the Universiade

Before the Universiade was held in 2011, all the new In order to ensure the safe and stable operation of generating units put into production are in the service of generating units during the Universiade, YUDEAN GROUP clean power generation projects—SCUT Station for YUDEAN takes different measures to check its coal supply contract, & SCUT PV generation project (the first PV power station of and signs the agreement for opening Qinhuangdao coal YUDEAN GROUP is the first independent power generation enterprise established YUDEAN GROUP), and No.1 generating unit of YUDEAN "special liner" with the relevant party to ensure the timely due to its "separation of power plant from power grid" in the whole country, as well as one of Zhanjiang biomass power generation projects (the first pure and adequate supply of fuels; it divides levels in managing the largest and most powerful state-owned enterprises under the direct control of Guangdong biomass generating unit with the largest single capacity in the fuels in the power plants in the Pearl River Delta region the world). YUDEAN GROUP deployed 11 generating units to make sure better resources are first of all provided to province. For the ten years since its foundation, YUDEAN GROUP has always been improving its which can be in the service of power supply in the key power the power plants relating to the Universiade, and supplies modern enterprise system, trying to optimize its industrial structure, energetically promoting guarantee area of the Universiade, with the installed capacity with preference the high cost and low sulfur content high its production technology level, and actively fulfilling its social responsibility; the Company's exceeding 4000MW. quality coal with over 5000 Cal thermal value and below With the successful experience accumulated during the 0.5% sulfur content to the power plants relating to the total assets, installed capacity, annual operating incomes and annual energy output are all guarantee of power supply to the Asian Games, YUDEAN Universiade, and at the same time increases the planned doubled, which made great contributions in promoting the steady and fast social and economic GROUP starts its following jobs according to the Executive air flow in the power plants with combustion engines to Plan for Power Safety Guarantee of the 26th Summer ensure the city's air quality from various aspects. development of the whole province. Universiade in Southern China drawn up by Southern In order to improve the water environment and aquatic We hope you can make a new start, accelerate the change of power development mode, continue Electricity Regulation Bureau, further improves the prevention ecology of the host city and guarantee the water safety, two with your reform and innovation, make further progress, to be stronger, larger and better, and and control measures for the power guarantee to the reservoirs of YUDEAN GROUP, reservoirs of Xinfengjiang Universiade, and appoints Shenzhen Qianwan Power Plant, Power Company and Fengshuba Power Company, are promote the rise of both economic benefits and social benefits, set a good example for the Shajiao A Power Plant and Shajiao C Power Plant which are involved in water transfer for the Universiade according to scientific development of state-owned enterprises under the direct control of the province, and close to the Universiade area as the key power guarantee the Programme for Guaranteeing the Water Supply Source make more contributions to the restructuring and building of a happy Guangdong! units; it also establishes and improves the Universiade power of Dongjiang River during Shenzhen Universiade drawn guarantee mechanism, sets out special power guarantee up by Guangdong Water Resources Department. During programmes, and mobilizes all its employees and makes the Universiade, 0.38 billion m3 water was transferred ——Huang Huahua, Former Governor of Guangdong Province overall arrangement, clarify responsibilities and ensures the for the Universiade, which is a great contribution for the smooth power supply to the Universiade. successful holding of the Universiade. 29/30 Set up "three-zero" defense line to guarantee power supply

"Zero fault" in equipment operation Equipment management and technical supervision, control repair and maintain quality strictly, and eliminate the equipment defects and accident potentials of the generating units. During repairing, on the basis of ensuring the scientific dispatching of power grid in Guangdong, the Company began repairing most thermal power units in the first half of the year to guarantee the single capacity of the dispatched units of the power grid during the Universiade. Make specific inspection for the power guarantee and eliminate any dead angles of potential safety hazard.

"Zero fault" of employees' operation All the power plants relating to the Universiade take measures to ensure the power supply, and mobilized all workers of the Company's power plant to carry out the power guarantee measures and ensure safe production. Arrange drilling of the planning to promote employees' ability for dealing with emergencies. Arrange production operators on duty during the Universiade to ensure the strength for maintenance of equipment. Guarantee power supply; organize different skill competitions and in-situ drilling activities to raise the employees' awareness of safety and level of skill.

"Zero accident" of safety protection Organize flood prevention, typhoon prevention and earthquake prevention drills to improve employees' emergent treatment and coordination abilities for dealing with natural disasters. Strengthen security defense and fire safety management during the Universiade and earnestly Case guarantee the safety of electric power system. On January 28, 2011, the first solar power PV power station of YUDEAN GROUP- Carry out safety assessment on information network, and set out contingency plans to ensure YUDEAN & SCUT PV generation project SCUT Station was formally combined to the network and information safety during the Universiade. the grid. After the project is totally put into production, annual output of electricity During the Universiade, we kept favorable and stable safe production, and there were no will be about 3 million kWh. Compared with the thermal power plants with the same personal injuries and equipment accidents, or fire and environmental pollution accidents, and

electricity output, it can reduce about 3000 tons of CO 2 , 23 tons of SO 2 and 7.67 we fulfilled the task of power guarantee successfully. Shenzhen Guangqian Company, Shajiao tons of NOx each year, and can supply clean energy source for the Universiade. A Power Plant and Shajiao C Power Plant won the Prize of Advanced Entity of Power Supply Guarantee for the Universiade by the State Electricity Regulatory Commission.

Guo Zhi, Director General of Southern Electricity Regulation Bureau:

With ten years of efforts, YUDEAN now has already had practical and steady corporate spirit and the employees' sense of loving the Company as it is their home, which helps YUDEAN to make great achievements in the severe market competitions. We thank YUDEAN for its great efforts of Case power supply guarantee during On July 17, 2011, Shenzhen Shenzhen Universiade. We hope Qianwan Power Plant which Corporate Social YUDEAN can continue making new shoulders the responsibility for Responsibility Report progress and innovation, take good power supply guarantee to the advantage of its own features and Universiade organized able strengths, work harder to improve workers to eliminate the defects the company competitiveness and of steam turbine impellors of make greater contributions to the fast No.1 generating unit and 149 development of the social economy parts of class B repair for No.2 in Guangdong. generating unit during about two months, enabling the generating units to serve the guarantee for power supply to the Universiade. 31/32 We insist on the guideline of "safety first, prevention dominant and comprehensive treatment" and believe that all accidents can be prevented. We emphasize on the observance to rules and regulations, and form the safety-conscious habit through Safe setting out systems, so that compliance culture can reach people, and continuously improve people's safety awareness and skills, eliminate the potential problems YUDEAN in work safety, and improve the safety operation management system. Safety problems do not only exist in production. We advocate the comprehensive and systematic safety outlook and emphasize on overall risk management. Objectives and performance Improve the safety system

Objectives Improve the management system

In 2011, we revised the Rules on Investigation of Power Industrial Accidents and set out the Rules on Responsibilities and Assessment Methods of Power Industrial Accidents according to the Emergency Disposal and Investigation Rules for Power Accidents issued by the State Council, and defined the implementation of work safety object management inside the Company as well as the safety object awards and production accidents accountability system. We also made up the Rules on the Responsibilities of All Workers for Work Safety in Power Enterprises, Rules on Training for Eradicate severe personal injuries Work Safety in Power Enterprises and Standard for Examination of Excellent Work Teams of Power Plants. Besides, 杜绝重伤以上人身事故 we also prepared and issued the Enterprise Standardization Management Standard, and carried out the recognition of Good Standardization Behavior in subordinate companies; issued the management methods of management Eradicate relatively large equipment failures, fire accidents and traffic accidents; innovation projects to conduct standardized management of the management innovation of subordinate power 杜绝较大以上设备、火灾、交通事故 plants. In 2011, Huizhou LNG Plant was awarded as the first domestic thermal power generation enterprise with class Eradicate dam failures and flush to factory buildings; AAAA Good Standardization Behavior as investigated and recognized by AQSIQ, SERC and CEC on site. 杜绝垮坝、水淹厂房事故 Eradicate plant interruption of power service, severe faulty operations and class A accidents that are under the responsibility of the plant 不发生本厂责任的全厂对外停电事故、恶性误操作事故、A 类障碍 Promote system construction

We stick steadfastly to the safety guideline of "safety first, prevention dominant and comprehensive treatment", and build the long-term mechanism of work safety through implementing the three standards, "ISO9000, ISO14000 and OHSMS18000", and SA NOSA Five-star Management System, and build a work safety management system covering personal safety, equipment safety, technical supervision and environmental health based on this, and regularly evaluate and verify the system to form a good mechanism with optimized process and sustained improvement. All subordinate units have drawn up hierarchal responsibility systems for work safety, set up the commission for safety, health and environmental protection, and formed a three-layer safety management network composed of the plant, Performance departments and work teams. In 2011, all the Company's subordinate power generation companies obtained the certificate of Integration of Three Standards. Eighteen companies had passed the verification of NOSA and obtained star rating, of which one power 未发生人身死亡、重伤事故 plant successfully obtained the maximum NOSCAR rating of NOSA verification, five power plants obtained five- star rating of NOSA, and eleven plants won four-star rating of NOSA. Nineteen subordinate enterprises received the There are no personal death and accidents involving serious bodily injuries 未发生较大及以上设备、火灾、交通事故 assessment on advanced power generation enterprises, among which 2 power plants won the title of class AAAA Advanced Power Generation Enterprise, 3 power plants won the title of class AAA Power Generation Enterprise, and There are no relatively large equipment failures, fire accidents and traffic accidents; 9 power plants won the title of class AA Advanced Power Generation Enterprise. 未发生垮坝、水淹厂房事故 There are no dam failures and flush to factory buildings; 未发生本厂责任的全厂对外停电事故、恶性误操作事故、A 类障碍 Case There is no plant interruption of power service, severe faulty operations and In August 2011, the Standard Operation Demonstration class A accidents that are under the responsibility of the plant Platform of Shajiao C Power Plant was completed and put 未发生直接人为责任的一般设备事故 into operation. The platform covers the common operations in the work site and is composed of nine demonstration There are no general equipment accidents directly caused by person areas including on-site use of PPE (personal protective 未发生 B 类障碍 equipment), electric welding and gas welding safety, There are no class B accidents erection and use of false work, work ticket, tools and 未发生职业健康危害事故 implements, temporary use of power, material stacking and marking and job location and refuse classification, which is There are no occupational health hazards an effective bearer for the safety, health and environmental 未发生环境污染事故和环保行政处罚事件 protection training to new comers and contractor There are no environmental pollution accidents and employees. So far, more than 3000 contractor employees administrative penalty concerning environment pollution who are involved in the repairing and overhaul of the plant's 未发生重大网络与信息安全事故 generating units have received such training.

There are no important network and information safety accidents 发电设备 C 类障碍次数同比下降 Frequency of class C faults of generating machinery drops compared with the previous year Corporate Social Responsibility Report

35/36 Strengthen team management The Company seriously carries out safety appraisal to its subordinate companies, and makes intensive investigation from equipment systems, working environment and work safety management in order to prevent personal injuries and grave and large equipment YUDEAN GROUP sets up the excellent work team assessment index system covering object management, foundation accidents. In 2011, it conducted safety appraisal or re-inspection of safety appraisal to 10 power plants, and found out 2716 management and process management according to its Standard for Examination of Excellent Work Teams of Power problems, of which 438 were important ones. The power plants paid special attention to the problems and arranged rectification Plants. It also carries out the "team building year activity", and continuously strengthens the construction of grass-root items by items. After the safety appraisal, the ratio of equipment faults dropped obviously compared with 2010. There were no work teams and facilitates work team foundation management with an aim to build "excellent work teams" and "five- class B or severer equipment accidents, and the frequency of class C equipment accidents dropped from 43 times in 2010 to 30 star work teams" according to the standardization, normalization and elaboration requirements. In 2011, one group of times, down by 30% year-on-year. The equipment health level was greatly improved. By the end of 2011, the longest successive the Company's power generation enterprises won the title of Nationwide Workers Vanguard, one group won the title of safe operation time had been 4144 days for thermal power plants and 6740 days for hydro power plants. Guangdong Advanced Group, and three work teams won the title of Guangdong Workers Vanguard. Operation management

We lay enough stress on the combination of NOSA system and operation management, actively organize risk assessments, and Work safety index strengthen hazard source control and process management; strictly carry out the "two tickets and three systems", and optimize the operation mode of generating units and improve the economy of unit operation through energy efficiency benchmarking and hundred-point emulation; strengthen fuel management, blend coal for mixed burning, strengthen burning regulation, and establish Classification Unit 2007 2008 2009 2010 2011 the quality early warning system for coals into the plants and boilers to ensure the stable and economic operation of boilers; and strengthen data analysis and trend analysis through the power plant real time production information system and other information Personal injuries Times 1 0 0 0 0 technology platforms to understand the equipment status, find and solve work safety problems, and ensure the safe and stable operation of generating units. In 2011, equivalent available factor of the Company's generating units was 91.20%, up by 2.1% Grave equipment year-on-year; the times of non scheduled shutdown dropped by 36 times year-on-year; 44 generating units, taking up 55% of the breakdown Times 0 0 0 0 0 total, had no non scheduled shutdown all the year around; maximum successive operation time of a single unit was 10416 hours.

General equipment Times 1 0 0 2 0 breakdown Average equivalent available factor of generating unit

Classification Unit 2007 2008 2009 2010 2011

Hydro power unit % 89.21 90.84 93.48 93.53 93.87

Thermal power unit % 92.34 91.25 90.24 88.53 90.90

Intensify work safety All generating units % 91.91 91.20 90.48 89.10 91.20

Equipment management

The Company reasonably arranges the repair time of generating units according to the power supply guarantee for the Project construction safety Universiade, and actively eliminates defects of generating units; It insists on the principle of "repair all needing repairing and fix all under repairing", continuously optimizes and improves the repairing model of generating units, strengthen repairing quality management and process control, reasonably increase the investments in technology reform and The Company earnestly fulfills its responsibility for safety management as a project construction unit, further standardizes the energy-saving reforming projects, and gradually carries out the spot inspection and maintenance system. In 2011, it process management of outsourced projects, and prevents contract issuing party from subcontracting the rights and duties to intensively solved the common problems of vibration, turn-to-turn faults and explosion and leakage of "four pipes" others; During project construction, we strictly carry out the system of "three simultaneousness", namely, safety facilities of newly of some thermal power units, and the equipment reliability has been obviously improved. It completely finished the built, rebuilt and expansion projects shall be designed, erected and put into use at the same time with the main works, so as to informatization reform of the large dam safety monitoring system of nine reservoirs, which greatly improves the large prevent project construction safety accidents. In 2011, a batch of new-constructed, reconstructed and enlarged generating units dam safety monitoring and reservoir regulation level, and finished the third regular safety inspection and registration of the Company were intensively tried and put into service. Correspondingly, we further increased our supervision to equipment and change of certificate of eight large dams of all subordinate hydraulic power plants, and all of the eight dams were installation and commissioning, strengthened production preparations and training and management of operators, eliminated safety evaluated as Grade A normal dam. loopholes, and realized the close connection between the project construction and production.

Corporate Social Responsibility Report

Enhance the elimination of defects to improve the health of equipments 37/38 Strengthen emergency management Boost safety culture

Further improve the construction of emergency system, and Safety education 634 contingency plans are prepared in all; Set up emergencies headquarters, strengthen the special emergency management We pay attention to the normalization of safety education and form a long-term mechanism for safety during the power guarantee and other special periods, and form a training in order to cultivate and enhance employees' awareness of safety, health and environmental smoothly directed, fast reacting and efficiently operated emergency protection. mechanism, which increases the Company's ability for guaranteeing In 2011, due to the weak safety management of contractors and careless implementation of work safety public safety and dealing with emergencies. rules and regulations, the Company organized training classes about on-site safety management, two- We pay high attention to emergency training and drilling of ticket management and contractor safety management for the safety monitoring directors and grass-root planning, intensify the awareness and ability for prevention safety officers of all subordinate units, and analyzed and explained the typical accident cases, site photos and preparation for accidents, monitoring and early warning, and accident heralds in the previous years. About 163 grass-root safety officers and managerial staffs of emergency handling, rescue, after recovery and so on according more than 30 units of the Company attended the training. Despite of the "work safety month" activity, to requirements of effective and appropriate solving of the plan, all units also organized different forms of education, knowledge and skill competitions, safety, health and continuously improve the emergency plans. In 2011, the and environmental protection examinations, on-site drills and other activities with "safety responsibility, Company's manufacturing enterprises organized 219 emergency emphasis on implementation" as the subject, which greatly improved the staffs' work safety awareness drills and anti-accident exercises about some frequently and easily and level of skills. happening disasters, such as extreme weather, natural disasters, fire, environmental pollution, maintenance of public order, isolated operation, large-area power-cut etc. 消防演练

Occupational health Case Flowchart of response to different emergencies of Shaoguan Power Plant Based on the safety, health and environmental protection system of NOSA, we carry out identification of hazard sources and risk assessment, monitor the influencing factors of occupational diseases at the job site regularly, strengthen on-site regulation, standardize all marks, and try best to ameliorate employees' working conditions and environment. Alarm given by the We strictly carry out the Law of the Peoples Republic of China on Prevention and Control of witness or sufferer Occupational Diseases and the relevant systems concerning labor protection, continuously increasing investments in labor protection to ensure the implementation of labor protection measures, and provide employees with essential personal protective equipment according to the relevant standards and regularly change and make up the equipment for them; each year, we organize employees for physical examination and ask working personnel of special professions for physical examination of occupational diseases.

Fire Environmental Equipment Natural Riots Casualties Emergent public alarm emergency failure disaster health events

shift supervisor Security Office fire office emergency (24h) [8200, emergency [110, 6637110 [119, 6637119 headquarters 6638200 headquarters (outside call)] (outside call)] 120 emergency treatment, (outside call)] effective isolation, rescue and inform the dispensary

receive alarm receive alarm environment operation flood control and action and action emergency party watcher group

see the fire at receive alarm the site and action operate or ask for help Corporate Social fight against from nearby isolate the on-site rescue rush to the on-site crimes and fire brigades equipment according to the site and deal inspection, Responsibility maintain the and system actual situations with the defense and order according emergency rescuing send the injured to to the actual Report rescue persons the nearby hospital situations and put out the according to the injury fire

Accident survey,site cleaning and recovery after

elimination of danger Neatly arranged personal protective equipment for on-site work of employees 39/40 Aiming at pursuing the "maximization of corporate value", we firmly pursue the coordination and harmony of the company's economic benefits, social benefits Excellent and ecologic benefits. Based on the industrial value chain, we focus our attention YUDEAN on our major business of power generation, widen the development space of the Company's associated businesses in energy source, transport and finance, continue with industrial structure optimization, speed up the transforming of intensive growth and achieve success with scale benefits and cost leadership. In 2011, the Company's thermal power, hydropower, new energy, logistics and financial sectors all made profits, but the overall Objectives and performance profitability was lower than the same period of the previous year, and profitability of hydropower and coal-fired power sectors declined the most. In 2011, assets liability ratio of YUDEAN GROUP was 59.16 %, which was leading among the similar industries. Objectives

Operating income is 45.8 billion yuan, up by 6.3% year-on-year; total assets at the end of period are 130.4 billion yuan, increased by 11.8%. Controllable on-grid electricity is 108 billion kWh, among which on-grid electricity in the Huang Long, Deputy General Manager of Huaneng Group : combined statements is 105.06 billion kWh, increased by 10% year-on-year. Controllable standard coal consumption for power supply of coal-fired power plants is 339 g/kWh. Board of directors of YUDEAN GROUP has fully performed its liabilities and seriously carried out the resolutions of the board of shareholders, and achieved excellent operating performance. With the leadership of the board of directors, YUDEAN GROUP keeps healthy and instant development, fulfills all work schemes formulated by the board of shareholders, and steadily improves its management benefits, development quality and level of management. The shareholders are very satisfied with the hard work of the vast employees of YUDEAN GROUP and show heartfelt thanks to them. Performance Major economic indicators Current year Amount in the Year-on-year same period of the increase and Item cumulative amount Operating revenue Net assets previous year decrease (billion yuan) (billion yuan) Operating revenue (billion yuan) 53.427 43 24.25% 60 53.427 50

Total assets (billion yuan) 132.173 117.713 12.28% 43.00 36.453 36.09 48 40.72 40 34.219 36.01 39.58 33.529 On-grid energy (billion kwh) 119.054 98.186 21.25% 36 34.15 30 Standard coal consumption of 321.62 -1% power supply (g/kwh) 324.85 24 20 Average direct station service power consumption rate (%) 5.63 5.72 -0.09% 12 10 0 0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Major economic indicators

Total assets On-grid electricity Realize increase in management efficiency (billion yuan) (billion yuan)

119.054 The year 2011 is the first year when the state 12th five-year plan was implemented. Power consumption in the whole 132.173 140 120 98.186 province kept increasing stably. Affected by the rise of financing cost, rise of coal price and shortage of water supply, 117.713 97.93 105.788 94.315 the power industry became one of the three industries among the 39 large industries of which the profits declined year 105 89.55 on year. In the face of the complicated economic situations and changeful external environment, we comprehensively 91.662 90 strengthen the sophisticated management, increase industrial restructuring, facilitate energy conservation and 88.891 consumption reduction, and make a good start for the 12th five-year plan. Our management benefits keep stable and 70 60 we win excellence for ten straight years in the examination of management responsibility system of government owned large enterprises under the direct control of the province. 35 30

10 10 Economic benefits 0 0 In 2011, total assets of the Company were 132.173 billion yuan; operating revenue in the whole year was 53.427 billion 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 yuan, and controllable on-grid electricity was 119.054 billion kWh, up by 21.25% year-on-year. On-grid electricity in the combined statements was 116.334 billion kWh, increased by 21.89% year-on-year, exceeding the excellence examination standard of Guangdong SASAC. 43/44 Benchmarking management Overall structural form of the intelligent analysis Case and management platform for thermal power unit indicators base on benchmarking According to the intelligent In 2011, the Company carried out benchmarking management of analysis of the Benchmarking production and technical indicators in thermal power enterprises, Management Platform of Thermal set out and issued the relevant technical indicator systems, Indicator system Benchmarking analysis Plants' Production and Technical benchmarking management methods and examination rules, Current application system Indicators, Huizhou LNG Plant developed the Benchmarking Management Platform for Production Indicator system Indicator data selected No.1 generating unit and Technical Indicators of Thermal Plants, and complemented the Comprehensive of Fujian Putian Power Plant main equipment ledger, developed the intelligent expert system for statistical system Power generation indicator Group advanced value as the standard to carry out indicator analysis and improvement, and preliminarily formed the Repair indicator Group mean value benchmarking management benchmarking management platform and network system with the SIS system Fuels indicator Group optimum value of production and technical special features of YUDEAN. Materials indicator Planed value ERP system Safety indicator Target value indicators. Through the special Through the benchmarking management, technical indicators of Reliability index Design value rectification based on its the Company's thermal power units are obviously improved, and Financial index Generating unit competition value advanced managerial experience, the effect of benchmarking management has preliminarily been Artificial Improvement the comprehensive station shown up. In 2011, standard coal consumption for power supply intelligence guideline service power consumption rate of coal-fired units was 328 g/kWh, down by 4 g/kWh year-on-year. was dropped from 3.17% at the System platform Operation log beginning of 2011 to 2.17%, and management standard coal consumption for Message power supply dropped by 3.48 g/ Calculation of indicator data management kWh. SMS platform Dynamic Statistical Definition of formula Calculation of data Uniform logon benchmarking form Schematic verification analysis

Authorities Standard coal consumption

for power supply dropped by distribution Basic data 3.48 g/kwh Organizational structure Generating unit information Benchmarking Data query report User information Benchmarking items

Hoisting of wind driven generators of Yongshi wind power station

Corporate Social Responsibility Report

45/46 Overall risk management The national innovation achievement prizes in enterprise management

Arrange and integrate the risk management systems of different levels of the Company, and build the overall risk management of the power industry won by YUDEAN GROUP system of YUDEAN GROUP. Strengthen the management of diversified enterprises, non power businesses and offshore investment risk management, explore offshore enterprise risk management model, and start and actively promote the standard management of Achievement name offshore enterprises. Pay enough attention to the feasibility study of investment and merger and acquisition projects, investigation Class Unit of fulfillment of responsibilities, planning of investment & financing programmes and risk prevention and control, and ensure the safety of capital operation and industry chain layout. First prize Actively establish the internal control system, improve the risk management system, optimize the process and organization function, Construction of double module intelligent tower power Red Bay Company plant management platform build the long-term mechanism of risk management and improve the efficiency and returns of risk management in effect, so that the Company can have relatively high level of risk management. First prize NOSCAR-construction-oriented dynamic integrated Shajiao C Power Plant Actively build the legal risk prevention system, and effectively prevent the enterprise strategic objective risk, investment & financing management & control model decision risk, financial risk, market risk, and operating risk, protect the enterprise legitimate interests from any harms, ensure the enterprise production operation can proceed legally, and protect the interest of contributors effectively. Second prize Coal combustion overall intelligent dispatching platform of Red BayCompany Encourage the functions of supervision and protection of audit, and lay stress on the audit emphasis and supervision function of the power plant board of supervisors. Facilitate restructuring of audit, carry out risk management audit, and introduce internal control and economic Second prize benefits to economic responsibility audit; promote the construction of internal control system in the enterprises affiliated to the Establishment and practice of the budget management Red Bay Company listed company, so that internal audit can be an important method of risk management and control. model of overall management & control Carry out the joint signing system in payment of salary, build a defense against salary payment risks, carry out centralized Third prize Development and application of integrated management Zhuahai Power Plant management of funds to make the best use of the scale advantage of funds, and strengthen funds monitoring to ensure the safety of system for repair and overhaul the Company's funds. Third prize Practice of guided corporate culture Guangqian Company Management innovation Third prize Analysis and design for building a planed statistic analysis Jinwan Company Actively carry out the normalized and institutionalized construction of the board of directors at all levels and the construction of system internal control system according to the principle of "setting standard for everything", and standardize government owned property right management according to law. Improve the human resource system, work safety system, operation management system and Third prize Exploration and application of energy management system Shajiao A Power Plant corporate governance system in accordance with the principle of "system above all", and continuously optimize the management in thermal power plants specification and process. Third prize Actively respond to the changes of internal and external environment, set up Operation Management Department, rebuild the Management model of HR integration Zhanjiang Power Company Capital Operations and Legal Affairs Department, and relocate Information Center, so as to better and promote the Company headquarters' function of integrated operation and capital operation. Third prize Application and innovation of equipment precision spot Shajiao A Power Plant Fulfill the task of standardizing employees' shareholding and intensification of reform in accordance with the deployment of inspection management Guangdong SASAC. Quicken the step of "one plant with several systems", try to integrate internal resources, assume the function of agglomeration and realize specialized management. Third prize Performance management of hydropower enterprises Xinfengjiang Power Stick to the principle of "making actual effects from principles" and boost subject study and use of achievements to provide Company referential solutions for the Company's management operation. Promote the Company's independent innovation and improve Third prize its soft power of management. In 2011, 14 of its management achievements won the national prize for corporate management New model of work team building in modern management Yuehua Power innovation achievements in power industry. Company Third prize Informatization construction Precision spot inspection of rotating machinery Zhuahai Power Plant According to the informatization development strategy planning and changes of internal and external environment of YUDEAN Third prize Improvement of power plant's safety protection and Guangqian Company GROUP, in 2011, the Company repositioned the Information Center, and its informatization construction developed gradually to management level using RFID technology uniform standardization and uniform construction, which effectively promotes the informatization level of production-oriented management. It greatly promoted the combination of informatization and industrialization, completed the construction of on-line monitoring substation for coal consumption of energy saving generation, popularization of ERP financial system, and construction of the data adapter for national asset supervisory system and so on. Its solar power plant real-time monitoring system was put into service, the marine spares management system was on trial operation, and construction of virtual warehouse was started. Carry out network security assessment and further strengthen network and information safety; Summarize the network and information safety protection measures and managerial experience during the Olympic Games, Asian Games and Universiade, and draw up the Network and Information Safety Management Method during Important Events of Guangdong Yudean Group Co., Ltd. to standardize and normalize network safety protection. In 2011, commerce network of YUDEAN won the Informatization Innovation Award of the Power Sector during the 11th Five-year Plan Period; hydropower EAM system, coal collection and processing management information system of Jinghai Power Company and digitized power plant management platform of Red Bay Company won the Outstanding Achievements Prize in Informatization of Power Sector during the 11th Five-year Plan Period; Development and application of the integrated quality, safety and environment management software platform of power generation enterprise of Yuehua Power Company was selected as one of the Corporate Social first batch of key projects with integration of informationization and industrialization to promote safety production by the Ministry Responsibility Report of Industry and Information Technology.

Director General of Guangdong SASAC Wen Guohui :

Achievement of YUDEAN's informatization work is embodied in its consistent application of informatization technology to different aspects and links of production. With the imperceptible infiltration for a long time, YUDEAN's informatization construction has made positive impacts on the enterprise business management and work safety from various aspects including reduction of cost, improvement of efficiency, saving of funds, and overall development of production operation, and has greatly strengthened the Company's competitive power. We hope YUDEAN can 47/48 continue working hard and make informatization construction play a greater role in its development. Enlarge strategic new energy Optimize power structure wind power With the development idea of "enlarging new energies", we speed up our steps in expanding the new energy field and greatly develop clean 0.61 % Construction of conventional power become more and more powerful energy resources including nuclear power, wind power, solar power, hydropower biomass energy, LNG and IGCC and have made great achievements, According to the development concepts of "strengthening conventional energy resources", in 2011, YUDEAN GROUP actively and have formed a new industrial pattern with clean energy like "wind 8.63 promoted the construction of generating units, and the application capacity of generating unit took 24.3% of the planed capacity in power, biomass energy, hydropower, natural gas, solar power, and nuclear the 12th five-year plan period. Its control over project construction period, quality and cost were leading in the country, and total % power". 0.40 biomass quantities winning the state approved initiation and commencement amounted to 7300MW. energy The Company's installation structure is further optimized. By the end of 2011, the Company's controllable installed capacity had % been 24809.7MW., increased by 17.1% year-on-year; Generating units with a single capacity of 600MW and above took up 56.03%, up by 7.03% year-on-year.

Governor of Guangdong Province, Zhu Xiaodan Ratio of structure Comparison of rise and capacity of thermal power units of generating units above 600MW With ten years of efforts, YUDEAN GROUP has made great progress. It gradually expands its size and gains favorable Generating units economic benefits; it plays a supportive role in the construction LNG solar energy below 300MW of power energy construction of Guangdong Province and makes generation great contributions to the social and economic development of 0.01 MW our province. We hope YUDEAN can continue paying attention to the optimization and adjustment of energy structure, further 9.43 % Generating units 16000 13900 develop new and renewable energies, increase its independent % from 300MW to 600MW 10380 innovation, improve its ability for independent innovation and core competence, and try to fulfill its strategic development objectives 12000 of the 12th five-year plan. 13.98 % 29.99 % 9380 9380 % 8180 80.92 8000 Thermal power

4000 Construction of power project of YUDEAN GROUP in 2011: 56.03 % 1000 On April 28, 2011, No.2 generating unit of Pinghai Power Plant (1×1000MW) was formally put into commercial operation. 2007 2008 2009 2010 2011 On September 2011, No.3 and 4 generating units of Shanwei Power Plant (2×660MW) were formally put into commercial operation. On August 20 and November 14, 2011, No. 1 and 2 generating units of Zhanjiang biomass power generation project (2×50MW) Generating units of 600MW and above were put into commercial operation respectively. Planned installed capacity of SCUT Station (A station) of YUDEAN and SCUT grid connection of PV power generation project (3000 Kw.) was 1.66MW, and was formally combined to the grid on January 28, 2011; Planned installed capacity of SYSU station (B station) was 1.34MW, and was formally combined to the grid on August 10, 2011. 88.37% of the total project of Zhanjiang Xuwen Yongshi Wind Power Station (49.5MW) was completed.

49/50 Green and efficient Zhuhai coal-fired power project Readjust industrial structure

Insist on the strategy of "focus on energy source and facilitate the co-development of relevant industries", and actively expand to the relevant diversified upstream and downstream industries while strengthening and enlarging the major business of power generation, and make great advancement in coal mine, natural gas grid, coal logistics, offshore shipping, power equipment manufacturing and financial areas. The "one major business with diversified auxiliary businesses" model which focuses on the power generation business and encourages the co-development of diversified businesses allows us to react to the severe economic situation and harsh market environment during the financial crisis. In 2011, the scale and benefits of the Company's diversified businesses, such as coal mine, environmental protection, port and finance were all higher than the same period in the previous year.

Industrial structure density of the Company

Finance 8.99% Case In February 2011, 57,000-dead weight ton newly made bulk vessel "YUDEAN 58" coal mine 1.46% was put into service in China Changjiang National Shipping Corporation Nanjing Jinling Shipyard. By then, total independent capacity of YUDEAN shipping company had reached 1,049,200 dead weight tons, making it a member of mega-tonnage others 9.58% fleet. On June 9, the last bulk vessel of the nine 57,000-ton bulk vessels, "YUDEAN 59", built by CSC for YUDEAN GROUP as contracted, was delivered successfully in Nanjing Jinling Shipyard terminal. Total hauling capacity of the shipping company of YUDEAN GROUP exceeded 1.1 million tons, making it the largest bulk transport fleet in Guangdong Province.

power generation 79.97%

Coal mine The Company steadily promoted the development of coal mine project and Shanxi Huoerxinhe coal mine project was smoothly put into production. By the end of 2011, the Company's equity coal output was 3.5 million tons, increased by 26.4% year-on-year; it signed coal mine MOU with Northern United Power Company and invested in NUPC Energy Company of which the total coal reserves are 1.91 billion tons through capital increase and share capital expansion. Shipping In 2011, the Company's self shipping capacity was 2,230,300 deadweight tons, increased by 17.43% year-on-year, ranking the 5th among domestic dry bulk transport enterprises, and was the largest bulk transport fleet in Guangdong. Finance In 2011, the Finance Company continued function as the uniform settlement center of YUDEAN to ensure the scale effect and intensification effect of the Company's funds, and provided financial support for the Company's capital construction, capital operation and production operation. Natural gas It made actual progress in acquiring the controlling interest over Guangdong Natural Gas Grid Co., Ltd., and had signed equity restructuring agreement smoothly with three large petroleum companies. After the restructuring, YUDEAN GROUP will relatively hold Guangdong Natural Gas Grid Company, which is great importance for the Company to develop its natural gas industry. Coal logistics Maoming Bohe coal terminal and Zhuhai port state coal storage and transportation center are constructed smoothly. 51/52 Widen regional layout

Unswervingly carry out the strategy of going global, deeply rooted in Guangdong, facing to the whole country and walking to Overseas industry distribution map overseas countries. Actively explore overseas market and participate in international economic co-operation and competition. Stick to the development philosophy of "simultaneous advancement of market merger and investment & construction", maintain the Britain investment and construction of power project and at the same time strengthen capital operation; it bought 50% stock rights from Holland InterGen together with Huaneng Group, and increased its equity installed capacity by 1260 MW, which greatly improved YUDEAN America GROUP's operation capacity and clean energy proportion in the international competitive market. The Company's businesses were also extended to European and American areas from the Asia Pacific Region, beginning its firm step to the international world. It set up Inner Mongolia YUDEAN Menghua New Energy Co., Ltd. and developed phase 2 and phase 3 projects of Inner Mongolia Baiyun'ebo wind farm.

Philippines Domestic industry distribution map

Inner Mongolia power plant and coal mine Mexico

Indonesia

Australia

President and CEO of InterGen, Neil Smith:

Purchase of stock from InterGen by YUDEAN GROUP and HUANENG GROUP plays an important role and has far-reaching strategic meaning to the further development and expansion of InterGen. As a powerful international service platform, InterGen would Shanxi coal mine like to have deeper cooperation with YUDEAN, continue deepening both sides' strategic cooperation, and make the best use and complement the resources and advantages of both sides to realize our mutual benefits.

Guizhou power plant and coal mine

Yunnan power plant and coal mine Rijnmond gas generation plant of InterGen in Holland

53/54 We put great efforts in developing clean energy, continue promoting the Blue Sky Project and improving the resource utilization efficiency, and form a Green circular economy model with the interaction and mutual stimulation between environmental protection and economization. We actively shoulder the responsibility for environmental protection, try to make each YUDEAN people YUDEAN practice and propagandize the philosophy of environmental protection, and create green energy to realize the coexistence with environment. Objectives and performance Dedicated to energy conservation and emission reduction

Objectives Set up the assessment system for energy conservation and emission reduction Establish and put into service the energy conservation and emission reduction system of thermal power Ensure there are no occupational health hazards, environmental plants, draw up the Management Method for the Assessment System of Energy Conservation and Emission pollution accidents and administrative penalties for environmental Reduction Indicators of Thermal Power Generating Units (Trial Implementation), which builds a platform pollution, for which the Company shall be responsible. for scientifically and reasonably assessing the energy conservation and emission reduction capability of thermal power plants and dynamically tracking the energy consumption level and environmental protection level of grass-root power plants. Make quantified and fair assessment on critical factors, and Performance make public the assessment result to encourage the power plants of the Company to make actual effects in energy conservation and emission reduction and continuously improve the capability and level of energy conservation and emission reduction. In 2011, there were no occupational health hazards, environmental pollution accidents and administrative penalties for environmental pollution, for which the Company shall be responsible. Boost the Blue Sky Project After six years of efforts in completing phase 1 project of the Blue Sky Project (desulfurization) which cost about 2.6 billion yuan, in 2011, we invested 0.22 billion yuan for phase 2 project of the Blue Sky Discharge of smoke dust Project (denitration), and reformed the low nitrogen content burner of 34 coal-fired units in active service (installed capacity amounting to 12120 MW) and added SCR flue gas denitration equipment. By the end g/kwh of 2011, denitration project of the power plants in Pearl River Delta region and Zhanjiang Power Plant 0.5 had been started; bid invitation for the main works and construction and installation had been finished and the contract had been signed. Among them, construction of the denitration project of Shajiao C Power 0.4 0.36 Plant, Zhanjiang Power Plant and No.5 and 6 generating units of Yuehua Power Generation Company 0.3 had begun. It's expected that in 2012, SCR denitration equipment for 7 generating units with 3160 MW capacities will be constructed and put into service. 0.2 0.17 In 2011, we also increased our technical reform of the current desulfurizers and cancelled the bypass 0.11 of desulfurizers. Average desulfurization efficiency and operation rate of subordinated power plants all 0.08 0.07 Discharge of sulfur dioxide 0.1 exceeded 90% and emission of about 360,000 tons of sulfur dioxide can be reduced each year, taking up g/kwh 0 over 50% of emission reduction in the whole province. 1.5 2007 2008 2009 2010 2011 1.35 1.2 1.09 0.9 Discharge rate of effluent 0.47 0.6 0.46 % 0.44 120 0.3 100 100 100 100 100 100 0 2007 2008 2009 2010 2011 75 50 25 Discharge of nitrogen oxide 0 g/kwh 2007 2008 2009 2010 2011 2.00

1.50 1.36 1.24 1.20 1.36 1.36 1.00 Comprehensive utilization rate of clinker % 0.50 100 100 98.28 0 97.5 96.0 2007 2008 2009 2010 2011 95 94.9 95.5 92.5 90 87.5

2007 2008 2009 2010 2011

Flue gas denitration equipment of No.2 generating unit of Shajiao C Power Plant 57/58 Develop circular economy Explore clean-energy According to the way of "unified planning— substantiation—industry extension" of the Company's environmental protection sector, we increased the direct use, cooperative use and harmless use of solid wastes, urged the environmental company to We insist on the philosophy of "create green energy wholeheartedly", stick to the low carbon development road, speed up the sign the Framework Agreement on the Comprehensive Utilization of Environment Friendly Raw Materials and Byproducts with development of hydropower, wind power, biomass energy, solar power, IGCC and other low carbon clean energies; capacity the Company's power plants to further improve the comprehensive utilization rate of wastes. In 2011, unified planning rate of of the clean energy newly put into production all the year around took up 2.8% of the total. By the end of 2011, controllable environment friendly byproduct sales of the Company was improved by 12.3% and comprehensive utilization rate of solid wastes installed capacity of clean energy of YUDEAN GROUP was 4734.7 MW (including LNG), taking up about 19.08% of the was 82%. Unified sales of byproducts from generation of the environmental company were 3.1613 million tons, increased by Company's total controllable installed capacity. 48.59% compared with the same period of the previous year. Wind power Strengthen the development of wind power resources. Preliminary work of Zhanjiang Shibanling Develop CDM project wind power project was approved by the Development and Planning Commission of Guangdong and was started; Zhanjiang Wailuo offshore wind power project was submitted to the state as the first offshore wind We actively react to global climatologic changes, shouldered the responsibility for abating the emission of greenhouse gas with power project in Guangdong; we also signed joint venture contract with Huadian Inner Mongolia and worked together actual deeds, and continuously proceeded with CDM project development and declaration in hydropower, USC, wind power, to develop phase 2 and phase 3 projects of Inner Mongolia Baiyun'ebo wind power station. PV generation, LNG and biomass. By 2011, we had registered five CDM projects in the U.N., including Shibeishan Wind Power project, and "emission of carbon dioxide" issued by the U.N. was 1.88 million tons all the year around. Hydropower We have 8 hydropower stations in Guangdong; we take an active part in the development of hydro power resources in the west, and invest in and hold Tianshengqiao first grade hydro power Improve the rate of utilization of water resources station of Guizhou Province. Currently, installed capacity of hydropower in active service is 2180MW. We work continuously to strengthen water conservation and the supervision and regulation of water utilization and conservation; we apply water conservation management to the whole process of planning, design, construction and operation, and actually We have built the largest PV generation project in Guangdong together Solar power PV generation control the gross amount of production water supply; actively popularize domestic and overseas advanced water conservation with a university (construction scale of phase 1 project is 3 MW), and it was technologies like air cooling, recycle of reclaimed water, seawater desalination, advanced treatment of recirculated cooling water combined to the grid in January 2011. Zhanjiang Biomass Power Plant PV generation project, Shunde PV generation etc., and employ mature water-saving technologies and equipment to reduce the consumption of fresh water to the greatest extent; project and Dongfang Heavy Machinery PV generation project (1MW, 1MW and 10MW) respectively won 2011 state and strengthen the hierarchical dispatching of hydropower and try to improve the efficiency of utilization of water resources. subsidy for photovoltaic construction and state subsidy for Golden Sun demonstration project, and were approved by the Development and Planning Commission of Guangdong for carrying out the preliminary works.

On November 14, 2011, the Company completed and put into service the biomass Biomass generation generation project with the largest single capacity and total installed capacity in our Case country now. In 2011, affected by the extreme dry climate from the southwest, water inflow was severely reduced Nuclear power We participated in nuclear power construction and acquired actual achievements. Yangjiang in Nanpan River valley. Because water consumption of isolated operation during low demands is Nuclear Power Plant became a shareholder successfully, and admission of Taishan Nuclear Power larger, Tianyi Hydro Power Plant took the measure of "full cut-off during low loads" to improve the Plant was also basically completed. rate of water power utilization. Through optimizing and adjusting the mode of operation of generating units, the plant shut down all generating units during low loads at night and sent station-service power through the main transformer; during the 84 days of "full cut-off during low loads", about 22.16 million Gas generation Preliminary works of Huangpu, Xinhui and Huizhou natural gas cogeneration project were kWh electricity was increased, amounting to 5.29 million yuan. approved by the Development and Planning Commission of Guangdong. At present, natural gas power generation takes up 9.43% of the gross installed capacity of YUDEAN GROUP.

Integrated gasification combined cycle (IGCC) Actively promote the demonstration construction of IGCC clean coal power generation technology, set up a joint venture corporation with state engineering study center for gas turbine and gasification combined cycle, and build Xinhui IGCC (integrated gasification combined cycle) national generation testing platform project.

Signing and unveiling ceremony of YUDEAN and HUAQING GASIFICATION COMBINED CYCLE GENERATION CO., LTD 59/60 Innovation in green technology

Increase investment in science and technology innovation

We continuously increase our investments in technological innovation, accelerate the construction of innovation system, and have basically formed the technical innovation mechanism combining production, study and research together. Besides, we also actively carry out the technical renovation for energy conservation and consumption reduction based on technical advancements and innovation. In 2011, we invested 0.33 billion yuan specially for the technology reform of energy conservation and emission reduction, and carried 370 large and medium technology reform projects, which gained significant economic and environmental benefits. The Company carried out the research on the adaptive load control optimization technology of large thermal power units in Shajiao C Power Plant and realized the fast change of load, deep peak regulation and energy conservation and consumption reduction of generating units; the technology is leading in our country. It has been successfully used in 13 same generating units in Guangdong and gained over 0.4 billion yuan of economic benefits and won the first award of Guangdong Science and Technology Award, making it the first project winning the highest provincial technology prize since YUDEAN GROUP was established. In 2011, the combustion device adjustment and motor VF energy-saving technology renovation project, boiler economical oxygen amount adaptive control implementation and application, furnace oil to gas of heat supply in Huizhou LNG Plant and blended coal combustion and boiler system energy-saving reforming project implemented respectively by Shajiao C Power Plant, Shaoguan Power Plant, Huizhou LNG and Yuelong Power Generation Company won the government special subsidy for energy conservation; through-flow part renovation YUDEAN Zhanjiang Biomass Power Plant with the project of Shajiao A Power Plant and Yuehua Power Generation Company was included in the financial incentive budget; Yuehua Power largest unit capacity and total installed capacity in the world Generation Company also received the special subsidy for denitration issued by Guangzhou City. On November 9, 2011, the first China international green innovation technology display was held in Guangzhou. Shibeishan Wind Power Company and Solar Power Branch Company of YUDEAN GROUP attended the display representing YUDEAN's achievements in green development.

Clean energy proportion

MW 4734.7

5000 4582.2 4582.2 4582.2 3366.6 4000

3000 2011 2000 2008 2009 2010 1000 2007

Beautiful Shanwei Power Plant 61/62 Strengthen energy-saving reforming Stick to the low carbon and environment friendly way

Follow out the state relevant energy policy, use large generating units and shut down small generating units, and gradually weed out small thermal power units with high dissipation of energy and large discharge amount. Encourage green office In 2011, we actively promoted Dabu Power Plant project, shut down small thermal power units of 1240 MW., Besides the popularization of NOSA safety, health and Case which made positive contributions to regional energy conservation and emission reduction. environmental protection system, we also encourage low Jinghai Power Company was dedicated to the building of a In 2011, we were the first to carry out the comprehensive improvements and reform of coal-fired units, and the carbon and environmental friendly living and working green garden-like power plant; for six successive years, it improvements and reform were involved with the through-flow part of steam turbines and reform of soft coal- styles. We encourage the saving of coal, water and power, encouraged employees to plant trees free of charge, and over fired boilers; great achievements in energy conservation and emission reduction were made, which caused continuously improve the level of office automation, and 2500 trees were planted, 172852 m2 turfs was planted, and the high attention of National Energy Administration, Development and Planning Commission of Guangdong popularize paperless office; facilitate reforms of meeting; more than 49000 hedges were fixed, which creates a good Province and so on. we also reduce the times and relevant costs of meetings atmosphere of creating green energy by all employees. At Subordinate companies take good advantage of the chances of repairs and overhauls to make technical through holding videophone conferences, and reduce the present, green space in the plant area has been 95%. renovation for energy conservation and emission abatement, and the results are satisfying. On December 28, office expenses greatly through taking measures for green 2011, at the final energy conservation conference during the 11th five-year plan period held in Guangdong, office work. ten units of YUDEAN including Guanghope Power Co., Ltd., Shajiao A Power Plant, Yuehua Power Generation Company, Jinwan Power Company, Zhuhai Power Plant, Shaoguan Power Plant, Huizhou Natural Gas Power Generation Company, Maoming Zhenneng Thermal Power Company, Yueyang Power Generation Company, and Jinghai Power Company were awarded as 2010 Guangdong Advanced Energy Conservation Unit; Three employees were awarded as 2010 Guangdong Advanced Energy Conservation Individual. Make registration for the first procurement of batteries, and change the old ones for new ones during later procurement; old batteries shall be collected and treated intensively; Gather the office supplies which contain harmful substances, such as old computers, ink boxes and so on, and hand them to qualified environmental companies to be disposed; Case Encourage 2-sided printing and reduce the use of printer paper; On December 22, 2011, the thermal power plant dust catcher reform technology transfer meeting Reduce the use of disposable pens and reduce consumption through changing refills; sponsored by China Electricity Council was held in Shanghai. The achievements of Zhanjiang Power Company of YUDEAN GROUP in reforming the bag-type collector of No.2 boiler were generally Use energy saving lamps for lighting in office and production areas; recognized by the leaders and representatives at the meeting. Take No.4 300MW generating unit of Strictly control the temperature of air-conditioning in office buildings and timely turn off the the Company as an example; after capacity increase and burning of bituminous coal, its normal rating central air conditioning after work; reaches 330MW; its heat rate is 511.7 kj/kWh dropped compared with that before reform, and reaches Try to reduce the times of lighting-up in the daytime; the level of 600MW subcritical generating unit; actually measured comprehensive coal consumption for power supply drops by 27 g/kWh year-on-year; after the reform, about 0.17 billion yuan is saved from Encourage employees to take a bus or cycle to go to work, and reduce the driving of private the generating cost each year, and the generating unit is taken as the comprehensive improvements and cars, so as to reduce exhaust emissions and consumption of oil and gas resources. reform demonstration generating unit by National Energy Administration and Development and Planning Commission of Guangdong Province. Keep biological diversity We pay special attention to the protection of ecological environment, and pay equal attention to development and protection during project planning, construction, production and operation, and try to harmonize power construction and project operation with the ecological environment. In July 2011, Jinwan Power Company and Red Bay Generation Company won the Loving Prize for Green Life Propaganda issued by Guangdong Propaganda and Education Center for Environmental Protection. Near Huizhou LNG Plant, there is Xiayong Tourist Area and sea culture area; In order to protect the local ecology from destruction, Huizhou LNG Plant entrusted Nanhai Institute of Oceanology of Chinese Academy of Sciences to make digifax forecast to the thermal discharge. The result shows that the ecology in the target protected areas including the tourist area and culture area near the plant are not adversely affected. In Changtan reservoir livestock breeding wastes cleaning project carried out by the local government, Changtan Hydropower Plant invested 40,000 RMB for removing the water lettuces and floaters in the reservoir to keep the ecology of the reservoir. Before the Tomb-sweeping Day, the plant joined the living resources reproduction activity held by the local government in Changtan reservoir area and put about 30,000 fish fries.

Case On March 11, 2011, more than 80 young volunteers of YUDEAN GROUP planted trees in the reservoir area of Fengshuba Power Company. It was the ninth year for YUDEAN to carry out its YUDEAN Young Volunteer Trees activity. YUDEAN Young Volunteer Trees have been deeply rooted and growing in 19 subordinate companies and the planting activity spreads YUDEAN's environment philosophy of "clean energy and harmonious environment".

63/64 Talent is the most essential resource of Yudean. We care about the development of every employee’s value, and are committed to providing our employees with an environment featured by effective participation and mutual support for their growth so as to achieve employee development and business success on the basis of trust, Harmonious respect, communication and teamwork. We advocate integrity in personal life and 适者为才,价值为要 doing business, transparency in management and openness in supervision. We attach Yudean importance to a harmonious atmosphere both within and out of the organization, respect the customs and culture of the communities, and strengthen liaison and communication with the locality to jointly build a harmonious community and create a favorable environment for development in every aspect. Objectives and performance Age distribution

To achieve employee To reward development society actively as the company grows

50 years 40~49 years 30~39 years 30 years and To achieve To collaborate and above mutual benefit in building 38.65% 37.41% below 15.94% with customers ecological 8% and partners civilization

No major illegal or rule-breaking case committed by the company’s executives or its communism leadership. No significant economic loss caused by institutional deficiency. No severe event affecting corporate image. Proportion of professional and technical title owners Care about employee development

We adhere to the strategy of strengthening enterprise through talent. We have been building various talent teams, improving recruitment procedures and attracting and nurturing excellent employees to provide personnel guarantee for the company’s sustainable development. We also adhere to the people-oriented principle, focus on the common growth of the enterprise and its employees. We inspire and mobilize employees’ enthusiasm, initiative and creativity. We share the fruits of reform and development with our employees. In 2011, Yudean Group focused on the construction of a modern human resource management system to strengthen the value- adding function of human resources. We formulated the 12th Five-year plan of human resource development. We gradually Senior title Intermediate Junior title advanced employee career planning and management in pilot units; we carried out performance review of the company’s leaders after their tenure ended; we conducted pilot work of salary management reform, and has been constantly improving the diversified 6.04% title 15.63% 21.59% salary system by combining salary with performance review; we vigorously implemented brand training and "Going Global" training strategy so as to reserve talents for the Group’s development diversity. The Group’s staff training rate exceeded 90%. Three employees won the title of “Technical Master-hand in Guangdong Province”, and six won the title of “Technical Master-hand Model in Guangdong Province”. As of the end of 2011, the company had totally 12,709 on-job employees, among whom female workers accounted for about 24.12%; 3,997 employees were under the age of 35, accounting for 31.45% of the total employees. Female management personnel accounted for 28% of the total managers.

Employees’ education background Skill level composition

Double Senior Intermediate Junior Secondary vocational competency Senior Master’s and above College degree school degree talent technician Technician worker worker worker and below 16.13% 1.09% 10.97% 32.13% 17.81% 2.26% 2.3% 66.3% 31.4%

67/68 Rights and interests of employees “Top Ten Employees over Ten Years” of Yudean We strictly enforce the Labor Contract Law and other relevant laws and regulations, pay close attention to the requirements of the ten principles of the United Nations’ "Global Compact", fully respect and safeguard the legitimate In 2011, to celebrate its 10th anniversary and promote and set up advanced rights and interests of employees, and attach importance to and support the construction of labor union organizations examples, the Company carried out an election of “Top Ten Employees over Ten Years” at all levels. The company’s labor union now consists of 40 labor unions at the bottom level of the organization, with within the system. The election was started in early 2011 and lasted several months. a staff membership rate of 100%. These labor unions have also established Female Workers' Committees or elected After layers of initiation, ten most representative employees were selected out of more female committee members to protect the legitimate rights and interests of the enterprise and employees by law. than 14,000 employees in an open and transparent manner. They embody the arduous pioneering and noble quality of Yudean in the past decade—burning themselves to illuminate others. Indicator 2008 2009 2010 2011 Su Jianyong Number of secondary labor Yuehua Company unions in the Group 33 35 37 40 Won the title of “Technical Master- hand in Guangdong Province” in Feng Lin Ratio of labor union establishment 2006; “Technical Master-hand of the 100% 100% 100% 100% Power Industry” in 2008; “Top Ten Yuejia Company within the company and Group Model of Yudean Group” in 2008; Won the 2009 National Labor first prize of power plant group in the Medal; advanced production Collective labor contract signing rate welder technology contest organized worker of Yudean Group in 100% 100% 100% 100% by Guangdong Electric Power 2008; Excellent Communist Industry Bureau in 1995; first prize of Party Member of Yudean the pressure group in the first welder Group in 2009. Staff membership rate technology contest organized by 100% 100% 100% 100% Guangdong Electric Power Holding in 2001; individual first prize in the second welding competition of Yudean Group in 2005.

We have further improved democracy in the management system, smoothed the channels for employees to participate Fang Junyong Shi Shengwang in the enterprise’s democratic management in the forms of Employee Representatives’ Meetings, publicising factory Shajiao C Power Plant Shaoguan Power Plant affairs, democratic dialogues, leadership reception day, Employee Representatives’ Forum and submitting appropriate Won the title of “Nationwide Won the title of “Employee Technical Master-hand” in the 8th Economic and Technical proposal, and earnestly guaranteed employees’ right to be informed, participate and supervise. In 2011, we in total election and “Technical Master- Innovation Master-hand in hand of the Power Industry” in Guangdong Province” in received 2,964 proposals for improvement, 1,929 of which were adopted. 2006; Technical Master-hand in 2006; Technical Master-hand We strictly followed the relevant laws and regulations of the State, standardized labor management, and made efforts Guangdong Province in 2005; in Guangdong Province in May 1st Labor Day Medal of 2006; Technical Master-hand of in eliminating any form of employment discrimination. We improved employment rate actively, provided equal Guangdong Province in 2010; Southern Guangdong in 2007; Technical Master-hand of Southern Knowledge-type Employee employment opportunities for both male and female workers, and never hired child labor. By doing so, we were Guangdong in 2007; Ten Model of Advanced Individual Nationwide Yudean Group in 2008; first prize in 2008; Labor Model in Shaoguan committed to building harmonious and stable labor relations. in the Thermal Skills Competition City in 2010. We strictly implemented the national salary distribution policy, established and improved a diversified salary system of Yudean Group in 2005. which combined salary with performance review. Under the requirement of “efficiency first, and equality ensured”, we gradually established and enhanced a normal salary increase mechanism for corporate staff by upgrading the company’s salary distribution and regulation system, so that the results of reform and development can benefit all Li Yun employees. We offered paid vacations and employee nursing leave for our employees, and ensured the proper Xinfengjiang Power Xue Zhaoxia Generation Company Red Bay Company implementation of on-job employees’ endowment insurance, medical insurance, employment injury insurance, Won the title of “Technical Won the May 1st Labor Day Master-hand in Guangdong Medal of Guangdong Province in maternity insurance, unemployment insurance and housing funds. We also established an annual bonus system in Province” in 2008; May 1st Labor 2010; May 1st Women’s Award order to safeguard the vital rights and interests of employees. Prize in Guangdong Province in of Guangdong Province in 2010; 2009; Meritorious Women Expert Ten Model of Yudean Group in of Yudean Group in 2010; first 2008; Meritorious Women Expert prize in Hydropower Automatic of Southern Guangdong in the Device Maintenance Skills provincial industrial labor union Competition of Yudean Group in system in 2008. Employees’ development 2008. Employees are the core resource and competitive advantage of the enterprise. We stick to the human resource ideas that “employing suitable personnel and emphasizing more on their value” and “overall performance, effective Zhang Jianbin incentive”. In 2011, we focused on constructing a modern HR management system, enhanced the value-adding Shajiao A Power Plant Yang Kai Won the second prize in the thermal function of human resource, and formulated the 12th Five-year plan of employee development. We revised and Zhanjiang Power Company generation relay protection skills competition of Yudean Group in adjusted the career paths for professional and technical employees of power generation enterprises within the Group, Won the title of “Excellent 2006; Technical Master-hand in Technical Master-hand of the Guangdong Province and Employee and gradually promoted employees’ career planning management in pilot units. We plan to set up a committee of Power Industry” in 2001; Youth Economic and Technical Innovation Post Master-hand of Yudean Master-hand in Guangdong Province expert technicians at the corporate level to broaden our employees’ career development channels. Group in 2001; third prize in youth in 2006; Post Technical Master-hand paper group of Yudean Group of Yudean Group in 2009; 2006- We provided employees with various forms of comprehensive training, encouraged employees to realize personal in 2006; 2007-2008 Excellent 2007 “Youth Post Master-hand” development, and nurtured personnel with excellent skills for the Company. In 2011, we vigorously implemented Communist Party Member of of Yudean Group in 2008; group Yudean Group; advanced worker second prize and individual third brand training and "Going global" training strategy, and built a personnel reserve for the Company’s diversifying, of Guangdong Society for prize in the relay skills competition Electrical Engineering in 2011. of Yudean Group in 2010; third prize of Technology Progress Award of with staff training rate exceeding 90%. We also carried out 24 batch-times of vocational skill certification. 1,252 Yudean Group in 2010. employees were certified, including 42 senior technicians, 229 technicians, 699 senior workers, 273 intermediate workers and 9 junior workers. Productivity per worker in 2011 mounted up to 4.1828 million yuan/person, and per Huang Wei capita installed capacity in 2011 increased from 678 kW/person to 1783kW/ person. Zhang Xueyun Maoming Power Plant We adhered to the idea of "overall performance, effective incentive", and gradually established and improved an Changtan Power Technical Master-hand in Guangdong Generation Company Province in 2009; Youth Post Master- effective performance management system. We further improved employee evaluation and motivating mechanism, Advanced Production Worker of hand of Yudean Group in 2002; Yudean Group in 2005; Safety total score third prize and individual and carried out performance review when the term of office expires to stimulate the overall vitality of the employees Advanced Individual of Yudean score third prize in the thermal Group in 2004; individual first professional skills competition of and senior management team. prize in the hydroelectric run skills Yudean Group in 2005; Youth Post competition of Yudean Group Master-hand of Yudean Group We have gradually optimized the enterprise’s recruitment mechanism, and established a cadre selection and in 2005; Technical Master-hand in 2005; Advanced Individual appointment mechanism in line with the requirements of modern enterprise management to create equal in Guangdong Province in 2006; in the “Create Learning-based Technical Master-hand of the Organization, Be a Knowledge-type opportunities for employees’ career development. We have also increased the efforts of competitive selection, and Electricity Industry Nationwide in Employee” Activity in Guangdong 2006. Province in 2006; new star first prize introduced external professional consulting firms to participate in the selection of executives to improve personnel in the nationwide electric power education and training in 2007. selection and employment satisfaction. The Company’s leadership personnel selection and appointment ranked in the forefront among 30 provincial enterprises. 69/70 Employee caring Cultural life

We strengthen human caring, deeply carry out assistance activity and “send warmth” activity, care about employees in difficulties We advocated the concept of “dedicated work, healthy life”, carried out a series of colorful and disadvantaged groups, establish a routine mechanism to visit employees with hard life or sickness, and help to solve the cultural and sports activities for the 10th anniversary of Yudean, and further enhanced the practical difficulties of employees. We also support various units in the system to set up “Employee Home” within the system to do Company’s cohesion and centripetal force. We created and succesfully presented a “Variety good and practical things and solve difficulties for employees. In 2011, we visited 1,486 poor and sick employee-times. Show to Celebrate the 10th Anniversary of Yudean Group” with Yudean characteristics, and organized four advanced deeds report meetings in the form of roving reports by regions. More than 2,000 employees from 36 units successively participated in the report meeting, and created the atmosphere of “respect labor models, learn from labor models and try to Case be labor models” among all employees. We also held the 4th “Yudean Cup” badminton competition in the form of pre-contest by regions and concentrated final contest, which Huang Lisen, an employee of the Operation Department of Guangqian Electric Power Company was strengthened the communication among employees and effectively promoted a national hospitalized due to a serious brain disease and needed craniotomy. On October 28, 2011, Guangqian fitness campaign. We also completed the creation of Share the Path despite Wind and Company issued an initiative calling on all workers to show love and help Huang Lisen to overcome the Rain—the song of Yudean. disease and ride out the storm with practical actions. After the issue of the initiative, all employees responded positively and lent a helping hand. In just three days, a donation of 128,478 yuan was received.

We attach importance to the work of female workers, are concerned about the growth and development of female workers, and ensure the special rights and interests of women workers. In 2011, we organized women workers to carry out “Meritorious Women Expert of Yudean” and “Civilization Demonstration Post of Female Staffs in Yudean” activities, continued to effectively run Yudean Workwoman which reflects the current priorities of women workers and the charms and colorful cultural and sports of Yudean female workers in the form of e-journal and serves as a platform for female workers to learn from and exchange their feelings with each other; we also carried out various characteristic activities for female workers to enhance their quality and enhance the organizational cohesion of female workers. We continuously improved and strengthened the management and services to retired and resigned persons, visited them and cared about their reasonable appeals, helped the old to solve practical difficulties, and held all kinds of cultural and sports activities conducive to the physical and mental health of the old.

10th Anniversary Art Performance

Provincial Governor Zhu Xiaodan (middle) visited the 10th Anniversary Achievement Exhibition of Yudean

Company leaders visited 93-year-old retired employee Zhang Qiang

In 2011, we independently investigated the employee commitment through a third party. 4,172 employees from 54 system units participated in the survey, accounting for 88% of the total number of people sampled for participation, and the survey covered the Company’s executives, middle management personnel of system units and ordinary employees. The survey findings showed that over 70% of the employees loved their post and were committed to their jobs, and identified their sense of belongs to Yudean Group.

71/72 Cooperation with suppliers We are committed to the establishment of a stable and healthy relationship with suppliers in various upstream and downstream industry Realize win-win cooperation chains, standardizing cooperation and reducing risks to achieve win-win. In 2011, we signed a Joint Venture Agreement on Shenhua Yudean Zhuhai Port Coal Terminal Limited Liability Company with Shenhua Group to jointly promote the construction of the Zhuhai Port We attach importance to establishing good and loose relations of cooperation with stakeholders, and are committed to promoting Coal Terminal; signed a Memorandum on Imported Coal Supply and Demand with Shenhua Sales Group Co., Ltd. to further expand the social progress and economic development through our own development. We adhere to the principles of operation by law, coal supply and demand partnership between the two sides; signed memorandums of cooperation and investment on Inner Mongolian standardized operation, mutual promotion and common development, carry out sustained, in-depth and extensive cooperation Gaotouyao, Wusigedu and other coal projects with Inner Mongolian North United Power Corporation, and signed a strategic cooperation with all stakeholders, and strive to achieve complementary advantages, mutual benefits, win-win cooperation and common agreement with Sinopec Guangdong Oil Products Company to integrate their advantageous resources, achieve cross-industry win-win development. combination, and establish long-term strategic partnership.

Government-enterprise cooperation International exchange Great efforts are made to establish a smooth and efficient communication and coordination mechanism between the Company We insisted on "going global" strategy, strived to expand overseas markets by strengthening international exchanges, and actively sought and government departments, strengthen the cooperation with government departments to promote the construction of projects overseas cooperation and investment opportunities. In 2011, we carried out 440 people-times of international exchanges and visits, and the and actively participate in community construction, and take advantage of the strengths of the state-owned enterprise to make number of foreign guests we received increased by 126% year-on-year. contributions to the economic and social development of Guangdong. On July 21, 2011, Pan Li, chairman of Yudean Group hosted a banquet to New South Wales Governor Barry Aofaruier and his entourage In October 2011, the Company attended the Guangdong-Hong Kong-Poland Economic and Technological Trade Fair held by the who came to Guangzhou to participate in the 24th Guangdong-New South Wales Joint Economic Meeting. The two sides reached a Guangdong provincial government in Poland, and had in-depth friendly communication and negotiation with foreign guests from consensus on further deepening their partnership, achieving complementary resources and advantages, ad expanding the fields and space Poland and the Middle and Eastern Europe on investment in electric power and coal projects at the meeting. of their cooperation. We actively attended the signing ceremony of Guangdong Product Southwestward Tour and Economic Trade Cooperation Project We also had in-depth exchanges with Canadian Alberta, British Columbia, Canadian Chamber of Commerce, Vietnam Coal Mining Group sponsored by Guangdong and Yunnan provincial governments, and signed energy cooperation agreements worth a total of 10 Company and other sides, and the two sides had discussions about hydropower, wind power, solar power and other new energies, as well billion yuan. The value of contracts signed ranked the third at the signing ceremony. Wang Yang, member of the Political Bureau as the feasibility of cooperation in coal supply and project investments. of the Central Committee and Party Secretary of Guangdong Province learned about the Guangdong-Yunnan energy cooperation projects at the booth of Yudean and fully recognized the energy cooperation between the two provinces.

Bank-enterprise cooperation We insist on sincere management, focus on bank-enterprise cooperation, and extensively carry out business cooperation with Betty Yuen, Vice Chairman of CLP power Hong Kong Limited domestic large financial institutions. In 2011, we worked closely with the Industrial and Commercial Bank of China and Agricultural Bank of China, and publicly issued 6 billion yuan of medium-term notes in the interbank market by two times, which aroused Just like the electric power market in the mainland, the electric power market in Hong Kong also faces many active subscription on the market. Subscription amount exceeded twice the amount of the actual issue, and eventually the notes challenges and pressures. CLP Power Hong Kong Limited cherishes every development opportunity. I hope were successfully issued by the lower limit of the issuance interest rates of corresponding non-financial corporate debt financing that together with Yudean, we can jointly seek ways to solve the common problems in the industry through instruments, 4.82% and 5.13 % respectively. constant exchanges and friendly dialogue, and develop a broader space for development for both parties.

Cooperation with industry peers We adhere to the principle of “equality and mutual benefits, resource sharing, complementary advantages and win-win Case cooperation”, and carry out in-depth cooperation with industry peers to achieve common and sustainable development. In 2011, we launched and hosted the first Guangdong-Hong Kong-Taiwan Power Enterprise Summit, signed a Letter of Intent on Cooperation On October 21, 2011, the first meeting of Guangdong, Hong Kong and Taiwan Power Business for the Inner Mongolian Bayan Ebo Wind Farm Project with Inner Mongolia Mengdian Huaneng Thermal Power Corporation Summit initiated and hosted by Yudean Group was held in Shenzhen, and the persons in charge Limited, actively participated in the fellowship society with energy enterprises in the Yangtze River Delta and Pearl River Delta, and of Taiwan Power Company, CLP Power Hong Kong Limited in Hong Kong, and Yudean Group discussed with Zhejiang Provincial Energy Group, Shenzhen Energy Group and Shenergy Group about how to rely on energy as the attended the meeting. The three parties discussed the theme of "coping strategies and new primary business, development appropriate industrial diversification and effectively promote the operating directions of industry- energy development and utilization of power companies in low-carbon economy". financing combination and collaborative operation resolving around the theme of “accelerating industry-financing combination and promoting the rapid and healthy development of energy enterprises”. In 2011, invited by CLP Group, the Company joined the “Asian Subbituminous Coal User Group”, attended the first annual meeting held in Hong Kong, communicated with CLP Group, HK Electric, Taiwan Power Company, Korea South East Power and other companies about the optimization of subbituminous coal combustion process, coal yard management and maintenance, operations and safety management, and shared overseas power peers’ experience in the technology, operation and safety management of subbituminous coal power plants.

Cooperation with customer Zhong Jun, general We strengthened communication and cooperation with power grid companies and dispatching departments, and strived to construct a harmonious plant-grid manager of the Southern relationship. In 2011, in the guarantee of power supply during the Universiade Power Grid Company: and satisfaction of peak demand in summer, we closely cooperated with the power grid companies, ensured the provision of adjustable unit capacity to Yudean is the first station for spreading the power grid to the greatest extent, obeyed the scheduling of the power grid, Southern Power Grid’s “serve the successfully completed various power supply guarantee tasks and fulfilled our people, and try to be best” into large responsibility to provide sufficient and green energy for society. enterprises, so all power generation We also worked together with China South Power Grid Company to jointly enterprises of Yudean should carry out the activity of bringing South Power Grid’s “serve the people, and try strengthen operation maintenance to be best” into Yudean, further strengthened plant-grid cooperation, jointly and infrastructure management so as tackled the peak demand in summer and winter, and laid a solid foundation to provide strong support for the safe for the safe power supply in the entire southern region. power supply in Guangdong Province We also signed a cooperation agreement for “R&D and promotion application and even the entire area covered by of power plant efficiency management system” project with China Southern the Southern Power Grid. Power Grid Integrated Energy Company, and comprehensively carried out comprehensive energy efficiency management system construction and energy diagnosis in the 16 thermal power plants within the Yudean system. 73/74 Combat corruption and uphold integrity Poverty alleviation programs BWe actively responded to the call of the provincial government, and earnestly fulfilled the poverty alleviation policy of “Household Planning and Individual Accountability”. Through water conservancy facilities, development of breeding We held to the guideline of equal attention to both the symptoms and root causes, comprehensive treatment, and planting, construction of village roads, renovation of dangerous buildings and other measures, the Company helped simultaneous development of punishment and prevention and emphasis on prevention, and worked hard and made the per capital annual net income of poor households to increase 78%. 202 poor households got rid of poverty, with a great progress in combating corruption and upholding integrity, intensifying internal supervision, and investigating and poverty-free rate of 97.6%. handling petition letter cases by law and rules, which had promoted the Company’s healthy and stable development In 2011, we continued to carry out “one on one” schooling assistance project, donation of desks and books to Hope We carefully implemented disciplinary education month activity, actively innovated the education means and enriched Schools, solving entrance tuition fees for children of poor families and other activities, and helped 66 poor students education contents resolving around the activity theme of “people-oriented, and ruling for the people”, and strived to in the Hope Schools in in a paired manner through “Yudean Group Love Schooling Assistance Fund”. achieve practical effects of education. We also organized various units in the system to participate in the “Clear Wind, By the end of 2011, units in the system of Yudean Group and individuals had donated to help nearly two thousand Ode to Integrity” election of anti-corruption paintings and photography works, and won a bronze prize and 4 excellent children who had dropped out of school, established 5 hope schools, helped 15 poor villages, and contributed to the prizes. We strictly executed the tender system and strengthened supervision over bid invitation; conducted efficiency construction and development of education in poor-stricken areas. monitoring of material purchasing, bidding management, fuel management, disposal of waste and old materials and other aspects. In the efficiency monitoring and election activity organized by State-owned Assets Supervision & Administration Commission of Guangdong Province, the efficiency monitoring projects of Shaoguan Power Plant and Yuehua Company won Excellent Project Award, the paper submitted by Zhujiang Power Plant and Huizhou LNG Power Co., Ltd. won Excellent Paper Award, and the Company’s Discipline Inspection Commission won Excellent Organization Award.

Honestly pay taxes by law

Paying taxes by law is a civic duty and social responsibility that an enterprise must perform. Ever since its establishment, Yudean Group has always regarded honestly paying taxes by law as a civic duty and social responsibility that it shall bear. Since 2001, the Company has paid 49.045 billion yuan of taxes. In 2011, Yudean Group paid 5.368 billion yuan of taxes; various units in the system were also awarded by the local government and tax authorities for their honest tax payment by law.

Case Zealous about public good On May 26, 2011, Yudean Group donated 100 sets of desks and all kinds of books worth over 3000 yuan to Primary Schhol. Since Yudean Group Love and public welfare set up “Yudean Group Love Schooling Assistance Fund” in September 2005, the company executives and headquarters and executives of direct subordinate By 2011, Yudean Group had invested more than 37 million yuan in all kinds of helping-the-poor projects. companies have voluntarily donated 87,200 yuan to help poor students in In 2011, Yudean Group won the golden prize of “2010 Guangdong Helping the Poor and Needy Red Cotton Award”, Gongguang Yudean Hope Project Primary School, Gaosha Primary School and and again donated 13 million yuan of poverty alleviation fund. The Company carried out “contribute our love, and build other schools in Luhe County, which has been widely acclaimed by the local a happy home” and other kinds of poverty alleviation and relief donation activities within various units in the system. government and the public. Yudean employees actively participated in the activities and made considerable contributions. Totally 1.412 million yuan of all kinds of love donations was received. Yudean Group thus performed its corporate social responsibility, and established a good and healthy corporate image.

Case On March 26, 2011, Xinfengjiang Power Generation Company carried out “Safe, Healthy, Environment-friendly and Happy Home” young volunteer promotion campaign about after-work safety, health and environment in the living quarters, and popularized after-work safety, health and environment knowledge to all employees and their family members through display boards, interactive Corporate Social games, environment protection signature, Responsibility Report knowledge lectures, question answering with gifts and other forms. 75/76 Expectations in 2012 Safer production More low-carbon development

Objectives Objectives

Put an end to personal accidents above serious bodily injuries; Prevent the occurrence of occupational health hazard accidents, environmental pollution accidents and Completely eradicate relatively large and larger equipment failures, environmental administrative penalty events; fire accidents and traffic accidents; Assessed coal-fired units’ power supply standard coal consumption is 327.6 g/kWh, down 0.4 g/kWh year- Put an end to dam failures and flood of factory buildings; on-year; Put an end to plant-wide interruption of power service to external areas caused "Blue Sky Project" Phase II (denitrification prject) plans to put a capacity of 3160 MW into production. by the Company, severe mal-operations, and class A faults. Measures Measures Conscientiously implement the Corporation’s "12th Fiver-year” energy saving plan, and steadily promote the "Blue Further strengthen safety system construction, and improve four kinds of emergency response management systems; Sky Project" Phase II construction (denitrification engineering); put emphasis on the comprehensive upgrading comprehensively carry out safety assessment works, and intensify equipment management, technical renovation and repair and renovation projects that can save over 10,000 tons of energy by the principle of “catching the big and letting and maintenance efforts; effectively prevent and control outsourcing projects, transportation, fire, after-work and other go of the small”; further strengthen operational management and energy-saving, and do a good job of energy safety risks; strictly perform onsite management, standardize process control, and prevent group death and group injury saving of the units; strengthen "industry-university-research" cooperation, and increase the energy technology accidents; implement safety responsibility, and enhance infrastructure and coal mining enterprises’ safety management. research; strengthen the management of pollutant emissions and carbon assets, and continuously push forward the development of CDM projects and reporting. More efficient management

Objectives More harmonious inside and outside

Achieve operating income of 57 billion yuan, an increase of 6.77% year-on-year; Objectives Total assets of 143 billion yuan at the end of the period, an increase of 8.17% year-on-year; Controllable power plant’s quantity of grid electricity reaches 124.5 billion kWh, an Achieve common development with employees; achieve mutual benefit and win-win situation with customers increase of 4.6% year-on-year. and partners; actively pay back society, and build a happy, Guangdong and a harmonious society. Prevent the occurrence of major illegal or rule-breaking case involving the company’s executives and party and government leading bodies of the system unit; put an end to significant economic losses caused due to the Measures defects of the system, and prevent the occurrence of major events affecting the corporate image; prevent the Strengthen research and judgment on the economic situation and industry market analysis, and establish a multi-level, occurrence of mass events. three-dimensional effective marketing system to enhance power generation efficiency; actively explore the sources of coal and reduce costs to ensure the safe and economical supply of coal; strengthen fund management, expand financing channels and improve financial security; optimize the business incentive mechanism, improve internal control and risk Measures management system, and elevate the Company's overall business control ability; improve the corporate governance Strengthen the leadership and staff building, and deepen the democratic management of enterprises; build human structure, promote transformation of equity management into “economical and efficiency-based” type; optimize and resources value development mechanism, enrich talent evaluation and training methods, and in-depth carry integrate the Company’s internal assets and property rights, establish a unified management system for power generation out talent introduction, training, career management and other works; strengthen cooperation with regions and companies, achieve intensive management and improve management efficiency. various stakeholders, increase the intensity and scope of cooperation, and enhance the quality of cooperation; actively engage in “day of helping the poor" and other social welfare undertakings and the construction of a More optimized structure happy Guangdong, pay back society and promote harmony. Objectives

Ensure the realization of 2711.5 MW of capacity of the units in operation; Expand a diversified space of development; make new progress in foreign investment and cooperation.

Measures Further optimize the Company's power structure, and vigorously develop clean energy projects with good economic returns; enhance industry collaboration, promote the Company's strategic restructuring, and actively promote the development and construction of natural gas pipeline networks, LNG receiving stations, coal mines, docks and coal storage and transportation centers and other projects; unswervingly implement the "going global" strategy, strengthen the management of overseas projects, and actively seek new foreign investment and cooperation opportunities.

77/78 G3.1 GRI Indicator cross reference list

Serial number GRI Indcator Content Serial number GRI Indcator Content

Strategy 1 1.1 Statement from the most senior decision-maker of the organization about the P5-6/P11-12/P77-78 32 4.7 Process for determining the qualifications and expertise of the members of the P13/P15/P69 and analysis relevance of sustainability to the organization and its strategy. highest governance body for guiding the organization's strategy on economic, 2 1.2 Description of key impacts, risks, and opportunities. P5-6/ P11-12/P43 environmental, and social topics. 3 2.1 Name of the organization. P1 33 4.8 Internally developed statements of mission or values, codes of conduct, and P10/P19-20/P34/P42/ 4 2.2 Primary brands, products, and/or services. P9 principles relevant to economic, environmental, and social performance and the P56/P66 status of their implementation. 5 2.3 Operational structure of the organization, including main divisions, operating P9/P13/P16

Organization profile 34 4.9 Procedures of the highest governance body for overseeing the organization’s P11-12/P75 companies, subsidiaries, and joint ventures. identification and management of economic, environmental, and social 6 2.4 Location of organization’s headquarters. P9

and engagement commitments Governance, performance, including relevant risks and opportunities, and adherence or 7 2.5 Number of countries where the organization operates, and names of countries with P9/P53-54 compliance with internationally agreed standards, codes of conduct, and principles. either major operations or that are specifically relevant to the sustainability issues 35 4.10 Processes for evaluating the highest governance body’s own performance, P9/P43/P47 covered in the report. particularly with respect to economic, environmental, and social performance. 8 2.6 Nature of ownership and legal form. P9/P13 36 4.11 Explanation of whether and how the precautionary approach or principle is P13/P20/P47/P75 9 2.7 Markets served (including geographic breakdown, sectors served, and types of P9/P25 addressed by the organization customers/beneficiaries). 37 4.12 Externally developed economic, environmental, and social charters, principles, or P1/P18/P40/P58 10 2.8 Scale of the reporting organization. P9 other initiatives to which the organization subscribes or endorses. 11 2.9 Significant changes during the reporting period regarding size, structure, or P9/P13-16 38 4.13 Memberships in associations (such as industry associations) and/or national/ P18 ownership. international advocacy organizations 39 4.14 12 2.10 Awards obtained in the reporting period. P21-22/P48 List of stakeholder groups engaged by the organization P17 40 4.15 Basis for identification and selection of stakeholders with whom to engage. P17 13 3.1 Reporting period (e.g., fiscal/calendar year) for information provided. P1 41 4.16 Approaches to stakeholder engagement, including frequency of engagement by P17 14 3.2 Date of most recent previous report (if any). P1 type and by stakeholder group. 15 3.3 Reporting cycle (annual, biennial, etc.) P1 42 4.17 Key topics and concerns that have been raised through stakeholder engagement, P17/P73-74 16 3.4 Contact point for questions regarding the report or its contents. P1 and how the organization has responded to those key topics and concerns, 17 3.5 Process for defining report content, P1 including through its reporting. 18 3.6 Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint P1 43 EC1 Direct economic value generated and distributed, including revenues, operating P7/P43-44 ventures, suppliers). costs, employee compensation, donations and other community investments, 19 3.7 State any specific limitations on the scope or boundary of the report. P1 retained earnings, and payments to capital providers and governments. 44 EC2 Financial implications and other risks and opportunities for the organization’s P58-63 Economic 20 3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced N/A activities due to climate change. operations, and other entities that can significantly affect comparability from period 45 EC3 Coverage of the organization’s defined benefit plan obligations. P40/P67-72 Reporting codes Reporting 46 to period and/or between organizations. EC4 Significant financial assistance received from government. Not involved 47 EC5 Range of ratios of standard entry level wage compared to local minimum wage at P67-71 21 3.9 Data measurement techniques and the bases of calculations, including assumptions P1 significant locations of operation. and techniques underlying estimations applied to the compilation of the Indicators 48 EC6 Policy, practices, and proportion of spending on locally-based suppliers at P38 and other information in the report. significant locations of operation. 22 3.10 Explanation of the effect of any re-statements of information provided in earlier N/A 49 EC7 Procedures for local hiring and proportion of senior management hired from the P67-69 reports, and the reasons for such re-statement (e.g., mergers/acquisitions, change local community at significant locations of operation. of base years/periods, nature of business, measurement methods). 50 EC8 Development and impact of infrastructure investments and services provided P75-76 23 3.11 Significant changes from previous reporting periods in the scope, boundary, or Not involved primarily for public benefit through commercial, in-kind, or pro bono engagement. measurement methods applied in the report. 51 EC9 Understanding and describing significant indirect economic impacts, including the P73-76 24 3.12 Table identifying the location of the Standard Disclosures in the report. P79-82 extent of impacts. 25 3.13 Policy and current practice with regard to seeking external assurance for the report. P85-86 52 EN1 Materials used by weight or volume. P43/P57 If not included in the assurance report accompanying the sustainability report, 53 EN2 Percentage of materials used that are recycled input materials. Not involved explain the scope and basis of any external assurance provided. Also explain the 54 EN3 Percentage of materials used that are recycled input materials. P43/P57 55 EN4 Indirect energy consumption by primary source. P43/P57 relationship between the reporting organization and the assurance provider(s). 56 EN5 Energy saved due to conservation and efficiency improvements. P58-59/P62-64 26 4.1 Governance structure of the organization. P13-15

Environmental 57 EN6 Initiatives to provide energy-efficient or renewable energy based products and P58-59/P62-64 27 4.2 Indicate whether the Chair of the highest governance body is also an executive Not involved services, and reductions in energy requirements as a result of these initiatives. officer 58 EN7 EInitiatives to reduce indirect energy consumption and reductions achieved. P58-59/P62-64 28 4.3 For organizations that have a unitary board structure, state the number of members P14 59 EN8 Total water withdrawal by source. Not involved

and engagement commitments Governance, of the highest governance body that are independent and/or non-executive 60 EN9 Water sources significantly affected by withdrawal of water. N/A members. 61 EN10 Percentage and total volume of water recycled and reused. P59 29 4.4 Mechanisms for shareholders and employees to provide recommendations or P13 62 EN11 Location and size of land owned, leased, managed in, or adjacent to, protected P64 direction to the highest governance body. areas and areas of high biodiversity value outside protected areas. 30 4.5 Linkage between compensation for members of the highest governance body, P16/P67 63 EN12 Description of significant impacts of activities, products, and services on P64 senior managers, and executives (including departure arrangements), and the biodiversity in protected areas and areas of high biodiversity value outside organization’s performance (including social and environmental performance). protected areas. 31 4.6 Processes in place for the highest governance body to ensure conflicts of interest P13 are avoided. 79/80 G3.1 GRI Indicator cross reference list

Serial number GRI Indcator Content Serial number GRI Indcator Content

64 EN13 Habitats protected or restored P64 98 HR2 Percentage of significant suppliers and contractors that have undergone screening Not involved 65 EN14 Strategies, current actions, and future plans for managing impacts on biodiversity. P64 on human rights and actions taken. 66 EN15 Number of IUCN Red List species and national conservation list species with habitats in N/A 99 HR3 Total hours of employee training on policies and procedures concerning aspects P67/69 areas affected by operations, by level of extinction risk. of human rights that are relevant to operations, including the percentage of 67 EN16 Total direct and indirect greenhouse gas emissions by weight. P57 employees trained. 100 HR4 Total number of incidents of discrimination and actions taken. No discrimination case 68 EN17 Other relevant indirect greenhouse gas emissions by weight. P57 101 HR5 Operations identified in which the right to exercise freedom of association or No such situation 69 EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved. P57-59/P61-64 Human rights collective bargaining may be at significant risk, and actions taken to support these 70 EN19 Emissions of ozone-depleting substances by weight. Not involved rights 71 EN20 NOx, SOx, and other significant air emissions by type and weight. P57-59/P61-64 102 HR6 Operations identified as having significant risk for incidents of child labor, and Not involved 72 EN21 Total water discharge by quality and destination. P59 measures taken to contribute to the elimination of child labor. 73 EN22 Total weight of waste by type and disposal method. P57/P59/P62-63 103 HR7 Operations identified as having significant risk for incidents of forced or compulsory P73-74 74 EN23 otal number of volume of significant spills. P37-38 labor, and measures taken to contribute to the elimination of forced or compulsory Environmental 75 EN24 Weight of transported, imported, exported, or treated waste deemed hazardous N/A labor. under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of 104 HR8 Percentage of security personnel trained in the organization’s policies or Not involved transported waste shipped internationally. procedures concerning aspects of human rights that are relevant to operations. 105 No such kind of violation 76 EN25 Identity, size, protected status, and biodiversity value of water bodies and related P59/P64 HR9 Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations. habitats significantly affected by the reporting organization’s discharges of water and 106 HR10 Percentage and total number of operations that have been subject to human rights Not involved runoff. reviews and/or impact assessments. 77 EN26 Initiatives to mitigate environmental impacts of products and services, and extent of P57-59/P61-64 107 HR11 Number of grievances related to human rights filed, addressed, and resolved Not involved impact mitigation. through formal grievance mechanisms. 78 EN27 Percentage of products sold and their packaging materials that are reclaimed by N/A 108 SO1 Percentage of operations with implemented local community engagement, impact P64 category. assessments, and development programs. 79 EN28 Monetary value of significant fines and total number of non-monetary sanctions for No such kind of 109 SO2 Percentage and total number of business units analyzed for risks related to P75 non-compliance with environmental laws and regulations. penalty corruption.

80 EN29 Significant environmental impacts of transporting products and other goods and Not involved Society 110 SO3 Percentage of employees trained in organization’s anti-corruption policies and P71/P75 materials used for the organization’s operations, and transporting members of the procedures. 111 P75 workforce. SO4 Actions taken in response to incidents of corruption. 112 SO5 Public policy positions and participation in public policy development and lobbying. P17/P73-74 81 EN 30 otal environmental protection expenditures and investments by type. P57-59/P61-64 113 SO6 Total value of financial and in-kind contributions to political parties, politicians, and No such kind of donation 82 LA1 otal workforce by employment type, employment contract, and region. P67 related institutions by country. 83 LA2 Total number and rate of employee turnover by age group, gender, and region. Not involved 114 SO7 Total value of financial and in-kind contributions to political parties, politicians, and No such kind of litigation 84 LA3 Benefits provided to full-time employees that are not provided to temporary or part- P67-71 related institutions by country. time employees, by major operations. 115 SO8 Monetary value of significant fines and total number of non-monetary sanctions No such kind of violation 85 LA4 Percentage of employees covered by collective bargaining agreements. P69 for non-compliance with laws and regulations. 86 LA5 Minimum notice period(s) regarding significant operational changes, including whether P67-71 116 SO9 Operations with significant potential or actual negative impacts on local Not involved Social labor practice and decent work it is specified in collective agreements. communities. 87 LA6 Percentage of total workforce represented in formal joint management-worker health Not involved 117 SO10 Prevention and mitigation measures implemented in operations with significant P36-38/P47/P58-64/P75-76 and safety committees that help monitor and advise on occupational health and safety potential or actual negative impacts on local communities. 118 Not involved programs PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services 88 LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and total number of P35/P40/P69-71 categories subject to such procedures. work-related fatalities by region. 119 PR2 Total number of incidents of non-compliance with regulations and voluntary codes Not involved 89 Product responsibility LA8 Education, training, counseling, prevention, and risk-control programs in place to assist P49/P69-71 concerning the health and safety impacts of products and services during their life workforce members, their families, or community members regarding serious diseases. cycle, by type of outcomes. 90 LA9 Health and safety topics covered in formal agreements with trade unions. P69-71 120 PR3 Type of product and service information required by procedures, and percentage of Not involved 91 LA10 Average hours of training per year per employee by employee category. P40/P67-71 significant products and services subject to such information requirements. 92 LA11 Programs for skills management and lifelong learning that support the continued P67-71 121 PR4 Total number of incidents of non-compliance with regulations and voluntary codes No such kind of violation employability of employees and assist them in managing career endings. concerning product and service information and labeling, by type of outcomes. 93 LA12 Percentage of employees receiving regular performance and career development P67-71 122 PR5 Practices related to customer satisfaction, including results of surveys measuring P73-76 reviews. customer satisfaction. Not involved 94 LA13 Composition of governance bodies and breakdown of employees per category P67-68 123 PR6 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction. according to gender, age group, minority group membership, and other indicators of 124 PR7 Practices related to customer satisfaction, including results of surveys measuring No such kind of violation diversity. customer satisfaction. 95 LA14 Ratio of basic salary of men to women by employee category. P67-68 125 PR8 Total number of substantiated complaints regarding breaches of customer privacy No such kind of violation 96 LA15 Return to work and retention rates after parental leave, by gender. Not involved and losses of customer data. 97 HR1 Percentage and total number of significant investment agreements that include human Not involved 126 PR9 Monetary value of significant fines for non-compliance with laws and regulations No such kind of violation Human rights clauses or that have undergone human rights screening. concerning the provision and use of products and services. rights 81/82 Comments from a third party Rating Report on CSR Report of Yudean Group in 2011 Research Center for Corporate Social Responsibility, Economics Division of Chinese Academy of Social Sciences accepted the entrustment of Guangdong Yudean Group Co., Ltd., and sampled experts from the Chinese Corporate Social Responsibility Report Rating Expert Committee to form the “Rating Group of CSR Report of Yudean Group in I have read CSR Report of Yudean Group in 2011 (hereinafter referred to as the Report), and hereby make the 2011” to rate CSR Report of Yudean Group in 2011 (hereinafter referred to as the Report). following comments: I. Rating basis The Report comprehensively displays the unceasing efforts and remarkable achievements that Yudean Group has China CSR Reporting Guideline (CASS-CSR 2.0) jointly released by Research Center for Corporate Social made in safety production, extraordinary management, green operations, harmonious development and other Responsibility, Economics Division of Chinese Academy of Social Sciences, China Enterprise Confederation, China aspects relying on accurate social responsibility management, effective communication with related parties and Petroleum and Chemical Industry Federation, China Light Industry Federation, Sino-German Corporate Social comprehensive fulfillment of social responsibilities under the guidance of the business philosophy of“harmonious Responsibility Project, China WTO Tribune and China Committee of Corporate Citizenship. development, pursuance to correct path and creation” and the business mission of “shouldering due social II. Rating results responsibility and contributing to the whole society”. Completeness ( ★★★★ ) The Report fully demonstrates the unique characteristics of Yudean Group in fulfilling social responsibilities. The Report discloses key indicators in “Corporate Governance”, “Safe Yudean”, “Excellent Yudean”, “Green Yudean”, “Harmonious Yudean” and other aspects, and covers 58% of the core indicators of the power production The first is “philosophy utmost and management first” promotion mode of corporate social responsibility. industry, boasting very good completeness. Yudean Group comprehensively integrates the concept of social responsibility into all levels and sections of Substantiality ( ★★★★☆ ) the corporate strategic culture, and has especially established over twenty working committees or working The Report follows the orientation of “goals and performance”, highlights the Company’s fulfillment performance, groups in safety production, environmental protection, employee development, integrity compliance and other and systematically discloses“guarantee of power supply”,“safety production”,“development of green power”,“saving aspects, realized the professionalization and full coverage of social responsibility management, and ensured of resources and energy”, “development of cycle economy” and other substantial issues in the power industry. the comprehensive fulfillment of its social responsibility in various links of the company’s operations. Balance ( ★★★☆ ) The second is “pursuit of internal excellence, and emphasis on external cooperation” development motivation The Report discloses “personal injury accidents”, “major equipment accident”, “general equipment accident” of social responsibility. Internally, Yudean Group pursues the coordination and unity of the Company’s and other negative indicators, and is thus balanced to a certain extent. economic benefits, social benefits and ecological benefits, constantly optimizes industrial structure, makes Comparability ( ★★★★ ) efforts to achieve intensive growth and provide increasingly expanding corporate strength and continuously The Report does a good job in vertical comparability, and discloses the historical data of a number of key stable internal development power for the construction of social responsibilities; externally, Yudean Group performance indicators, without disclosing horizontally comparable data in the same industry. Readability ( ★★★★☆ ) actively realizes effective communication and close corporation with various stakeholders and social dialogue The Report features a clear structure and smooth language, reasonably uses data charts, visual graphs, photos and partners. Therefore, the Company’s sustainable development and social responsibility contribution has won other expressive means, boasting very beautiful design, and also explains professional terms. So it is very readable. extensive social recognition and unceasing external support. Innovation ( ★★★★ ) The third is outward and unceasingly expanding running process of social responsibility. Yudean Group The Report systematically introduces the Company’s responsibility fulfillment in the past ten years in the form successively promoted the running process of social responsibility including safety production, environmental of special topics, and discloses the Company’s practice of bravely bear responsibilities for guaranteeing power protection and social construction according to the characteristics and priorities of its production and supply for the Universidad, very innovative in this sense. operations. Yudean Group has supported the stable local economic and social development through safe and Comprehensive rating ( ★★★★ ) reliable power supply, achieved benign interaction with nature and gets along friendly with the environment Assessed by the rating group, CSR Report of Yudean Group in 2011 is four-star level, and an excellent corporate through the development mode of a cycle economy, and indeed realized win-win and common development with social responsibility report. society owing to the full care about various interests. III. Recommendations for improvement In summary, the Report has comprehensive contents, detailed data, clear information norms, specific and 1. Increase the disclosure of causes for the occurrence of negative information and improvement measures, and improve the balance of the report. vivid tables, pictures and cases, and is a high-level CSR in line with the Global Reporting Initiative (GRI) 2. Appropriately disclose peers’ data, and boost the report’s horizontal comparability. Sustainability Reporting Guidelines and the requirements of the UN Global Compact for compiling an annual 3. Further enhance and disclose the company’s social responsibility planning and strategic orientation. progress report. IV. Rating group Group leader: Executive Vice Chairman of the Center, Director of Research Bureau of SASAC Peng Huagang Member: Director of Electric Power Reliability Management Center, State Electricity Regulatory Commission Mi Jianhua Vice President of Lingnan College of Sun Yat-sen University Chen Honghui Vice President of China WTO Tribune Yin Gefei Director of Research Center for Corporate Social Responsibility, Li Decheng Economics Division of Chinese Academy of Social Sciences Zhong Hongwu Executive Vice President of China Enterprise Confederation and China Entrepreneurs Association, and Chairman of the United Nations Global Compact Board of Governors

Chen Jiagui Peng Huagang Chairman of the Center Leader of the rating expert panel Standing Committee of NPC Executive Vice Chairman of the Center Director of Economics Division of Chinese Director of Research Bureau of SASAC Academy of Social Sciences Corporate Social Responsibility Report

83/84 Explanation of technical terms

Coal consumption rate for power supply

Also known as standard coal consumption for power supply, refers to the average consumption of standard coal for thermal power plants to provide every 1kWh of electricity output (unit: g/kWh). Station service power consumption rate SCR It refers to the process where under the effect of catalyst, nitrogen oxides in the flue gas selectively react with Refers to the percentage of self-consumed electricity the reducing agent to produce nitrogen and water for directly used in power generation and production by power removal of nitrogen oxides (NOx) in the flue gas. SCR has generation plants in the quantity of generated power. a high denitrification efficiency (70-90%). It is a mature denitrification process, and is currently the most widely used denitration technology.

Quantity of on-grid electricity

Refers to the quantity of electricity input LNG power LNG is the abbreviation of Liquefied from the on-grid electricity metering generation Natural Gas. LNG power generation point to the system (grid) by power is an integrated gas-steam combined generation companies, namely, the cycle power generation mode with quantity of electricity sold by power natural gas as the fuel, which is clean, generation companies to the market. efficient and safe.

IGCC IGCC—Integrated Gasification Explanation of technical terms Combined Cycle power generation system is an advanced power system combining gasification technology and efficient combined cycle, and a new generation of advanced clean fuel combustion power generation system.

NOSA It is the abbreviation of South African National Occupational Safety Association, founded on April 11, 1951, which is a quasi- government department approved by the Workers' Compensation Photovoltaic Commission. Just like other civil power generation society organizations, NOSA was a Biomass power non-profit organization in early days generation It generally refers to solar power generation, after its inception. Now NOSA has referred to as “PV power”, and is a technology become the substitutive name of the It is a type of power generation using photovoltaic effect on semi-conductor safety, health and environmental risk interfaces to directly transform light into electricity. management system. from renewable biomass energy, including direct Equivalent availability factor combustion of agricultural Refers to the ratio of the difference and forest wastes, gasification between the unit’s available hours and of agricultural and forest Quasi-liner the unit’s equivalent derated outage wastes for power generation, It is a “on-time arrival, oriented shutdown hours to the unit’s hours garbage combustion for power shipping and fixed coal” seaborne during the survey period. generation, garbage burial coal transportation mode, with and gasification for power stable supply, efficient operation generation, and biogas power Corporate Social and other characteristics. generation. 2011 Responsibility Report

85/86 510630

To: Yudean Plaza, No.2 Tianhe Dong Road, Guangzhou City, Guangdong Province, China

Recipient: General Affairs Department

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