It is reported that China Power International Development Ltd and China Coal Energy Co have agreed to invest CNY 4.98 billion to form a joint venture as part of a strategic alliance amid volatile coal prices. The joint venture will invest build and operate coal-fired power plants, China Power.

China Power will contribute 80% of the venture registered capital of CNY 1 billion and China Coal will provide the balance. The venture whose name was not disclosed will acquire two 660-megawatt power generating units from China Power wholly owned Shentou I Power Plant in Shanxi Province.

China Coal, the country second biggest coal producer will supply coal to the venture at a favourable price compared to the prevailing coal price supplied to the power plants of the five largest national power generating groups in the same region.