Contents Chairman’s Statement 3 Corporate Profile 4 Financial Highlights and Major Operational Data 13 Management Discussion and Analysis 16 Human Resources 32 Biographies of Directors, Supervisors and Senior Management 34 Report of the Board of Directors 40 Corporate Governance Report 60 Report of the Board of Supervisors 75 Independent Auditors’ Report 78 Consolidated Statement of Profit or Loss and Other Comprehensive Income 84 Consolidated Statement of Financial Position 85 Consolidated Statement of Changes in Equity 87 Consolidated Statement of Cash Flows 88 Notes to Financial Statements 90 Definitions 187 Corporate Information 191 1 China Suntien Green Energy Corporation Limited Annual Report 2017 Chairman’s Statement 2 China Suntien Green Energy Corporation Limited Annual Report 2017 Chairman’s Statement Dear Shareholders, 2017 was an important year for the implementation of China’s “13th Five-Year Plan”. With the speeding up of the pace of ecological civilization construction, effective implementation of green development and the continuous promotion of structural reform of energy supply side, the cleaning progress of energy was further accelerated. Leveraging on the government’s strong support for renewable energy and clean energy industries, in 2017, the Group strived to develop its wind power and natural gas business, expanded renewable energy and clean energy business and enlarged the industrial scale so as to continue to enhance the profitability of the Group. In 2017, the asset structure of the Group remained stable and its operation indicators were beyond expectation. As at the end of 2017, the Group realized total sales of wind and photovoltaic power generation of 6,692 million kWh; sold 1,879 million cubic meters of natural gas; the consolidated total assets of the Group amounted to RMB34,288 million; realized revenue of RMB7,058 million, total profit of RMB1,204 million and net profit of RMB1,105 million, of which the net profit attributable to the owners of the Group amounted to RMB940 million. In 2018, with the direction from the spirit of the 19th National Congress, the Group will encounter new development opportunities under the environment of acceleration of reform of ecological civilization system, building of a beautiful China, promotion of energy production and consumption revolution as well as the establishment of a clean and low carbon energy system in a safe and efficient manner. The Group will stick to its business development direction and continue to focus on renewable energy and clean energy, actively promote the development of major markets of wind power and natural gas segments and the implementation of projects, earnestly capitalise on the refined management of operating assets and actively explore innovative development. In addition, the Group will strive to build a much stronger business structure, keep abreast with new technologies and their application, and continuously upgrade technologies applied in its operation and maintenance. The Group aims to further improve its business structure, diversify its source of profits, enhance the standards and efficiency of its management system, refine its fund management measures and steadily improve its management level in connection with production, operation and maintenance, so that it could become a renowned listed company with stronger capabilities in innovation and sustainable development for driving the continuous growth of the enterprise in the course of building a beautiful China. Cao Xin Chairman Shijiazhuang, PRC, 19 March 2018 3 China Suntien Green Energy Corporation Limited Annual Report 2017 Corporate Profile China Suntien Green Energy Corporation Limited was established on 9 February 2010 by shareholders HECIC and HECIC Water. The Company was listed on the Main Board of the Hong Kong Stock Exchange on 13 October 2010. The Group is primarily engaged in the exploration and utilization of new energy and clean energy, with two major business segments: the wind power business and the natural gas business. The Group is engaged in the planning, development and operation of wind farms as well as the sale of electricity. The Group owns wind power projects in Hebei, Shanxi, Xinjiang, Shandong, Yunnan and Inner Mongolia, etc. Based in Hebei, the Group has invested and developed wind power projects across the country, and has actively sought suitable investment projects overseas. As at 31 December 2017, the Group had wind power consolidated installed capacity of 3,348.35 MW as well as attributable installed capacity of 3,023.90 MW. In 2017, the gross wind power generation of the Group was 6,737 million kWh with 2,392 utilization hours. The Group possesses natural gas transmission and ancillary facilities in Hebei province, and sells natural gas through natural gas distribution channels. As at 31 December 2017, the Group owned 6 long-distance natural gas transmission pipelines, 9 high-pressure branch pipelines, 29 urban gas projects, 16 distribution stations, 10 gate stations, 7 CNG refilling stations, and 7 CNG primary filling stations. In 2017, the sales volume of natural gas of the Group was 1,879 million cubic meters. In 2017, the PRC economy showed an upward momentum while maintaining a stable outlook. With the acceleration of the construction of an ecologically civilized society, effective implementation of various measures for green development, continuous promotion of the supply side structural reform of the energy sector, as well as the commencement of international cooperation for energy production based on the “One Belt One Road” initiative, the energy production and consumption revolution had deepening reforms within the country, and progress of using clean energy was further accelerated. Supported by stable energy supply in general, the structure of energy consumption was further optimized and energy conservation and emission reduction attained new achievements. The Group will actively follow the direction of government policies to develop its business in full efforts, expand its business scale, focus on the development of wind power and natural gas, and explore other renewable energy and clean energy, with a view to constantly improving the profitability of the Group. 4 China Suntien Green Energy Corporation Limited Annual Report 2017 Corporate Profile 5 China Suntien Green Energy Corporation Limited Annual Report 2017 Corporate Profile 1. CORPORATE STRUCTURE As at 31 December 2017, the corporate structure of the Group was as follows(1): 100% 100% 100% 70% 100% 100% 100% 100% 70% 70% 49% HECIC Jianshui Suntien Yunnan Pushi Chaoyang Suntien Suntien Hebei Xingyang Suntien Wulian County Suntien Green Suntien Liquefied Chengde Dayuan HECIC New-energy New-energy Wind Energy Natural Gas New Energy Electricity Sales Wind Energy Suntien Wind Energy Xuyi Natural Gas New Energy Co., Ltd. (Tangshan) Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Shahe Co., Ltd. Co., Ltd.(4) 30% 55% 92% 100% 95.31% 100% 100% 100% 100% 100% 69% 50% Suntien Hebei Suntien Green Guangxi Suntien Heilongjiang Suntien Suntien Green Weihui Suntien Junan Suntien Suntien Green Hebei Suntien Hebei Natural Gas Ruoqiang Suntien Solar Energy Energy (Fengning) Green Energy Hadian New Energy Energy Investment Green Energy Wind Energy Energy (Hong Kong) Guohua Gas Company Ltd. Green Energy Development Co., Ltd. Co., Ltd. Investment Co., Ltd. (Beijing) Co., Ltd. Co., Ltd. Co., Ltd. Corporation Limited Co., Ltd.(2) Co., Ltd. Co., Ltd. 51.4% 100% 100% 51% 100% 100% 100% 100% 30% 20% 10% HECIC Offshore Hebei Fengning Fangchenggang Huludao Liaohe Fuping Jixin Tongdao Suntien Fuliang Zhongling Shenzhen Suntien Hebei Jinjianjia Hebei Fengning HECIC Group CIC New Energy Suntien Green Oil Field Gas New Green Green Energy Suntien Green Green Energy Natural Gas Pumped Storage Finance Company Wind Power (3) (5) (6) Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Energy Co., Ltd. Investment Co., Ltd. Co., Ltd. Co., Ltd. Limited 6 China Suntien Green Energy Corporation Limited Annual Report 2017 Corporate Profile 100% 100% 100% 70% 100% 100% 100% 100% 70% 70% 49% HECIC Jianshui Suntien Yunnan Pushi Chaoyang Suntien Suntien Hebei Xingyang Suntien Wulian County Suntien Green Suntien Liquefied Chengde Dayuan HECIC New-energy New-energy Wind Energy Natural Gas New Energy Electricity Sales Wind Energy Suntien Wind Energy Xuyi Natural Gas New Energy Co., Ltd. (Tangshan) Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Shahe Co., Ltd. Co., Ltd.(4) 30% 55% 92% 100% 95.31% 100% 100% 100% 100% 100% 69% 50% Suntien Hebei Suntien Green Guangxi Suntien Heilongjiang Suntien Suntien Green Weihui Suntien Junan Suntien Suntien Green Hebei Suntien Hebei Natural Gas Ruoqiang Suntien Solar Energy Energy (Fengning) Green Energy Hadian New Energy Energy Investment Green Energy Wind Energy Energy (Hong Kong) Guohua Gas Company Ltd. Green Energy Development Co., Ltd. Co., Ltd. Investment Co., Ltd. (Beijing) Co., Ltd. Co., Ltd. Co., Ltd. Corporation Limited Co., Ltd.(2) Co., Ltd. Co., Ltd. 51.4% 100% 100% 51% 100% 100% 100% 100% 30% 20% 10% HECIC Offshore Hebei Fengning Fangchenggang Huludao Liaohe Fuping Jixin Tongdao Suntien Fuliang Zhongling Shenzhen Suntien Hebei Jinjianjia Hebei Fengning HECIC Group CIC New Energy Suntien Green Oil Field Gas New Green Green Energy Suntien Green Green Energy Natural Gas Pumped Storage Finance Company Wind Power (3) (5) (6) Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Energy Co., Ltd. Co., Ltd. Energy Co., Ltd. Investment Co., Ltd. Co., Ltd. Co., Ltd. Limited Notes: (1) Please note that the corporate structure chart covers first-tier subsidiaries of the Company only. Subsidiaries on second-tier and below are not listed. Details of subsidiaries of the Company and material associates and material joint ventures of the Group are set out in Note 1 of the Financial Statements. (2) Hebei Suntien Guohua Gas Co., Ltd. is a joint venture of the Company. (3) Hebei Jinjianjia Natural Gas Co., Ltd. is an associated company of the Company. (4) Chengde Dayuan New Energy Co., Ltd.