The electric power investment's rapid growth compensated the undercapitalization which has prevailed since 1998. As China's electric power supply will keep imbalance until 2006, and the regulations on the macro economy won't influence the growth of electric power investment. The whole boom period will at least last to 2006 due to the increasing demand for the electric power equipments.

Power plant construction will be tilted to large capacity, high efficiency electric generator set, the proportion of 0.6 million kilowatt and above promoted rapidly.

Meanwhile, demand for hydropower generation units and natural gas fuelled generation units, keeps increasing. But the power grid investment, along with the process of west to east power transmitting and area interconnection project, extra-high electric transmission lines' construction, the qualities in transporting the electric power, the degrees of power transmission, distribution equipments and automation are all need to be improved increasingly.

Market will continuously tilt to the large electric power equipment enterprises, which are powerful in technology and production, and the degree of concentration keeps improving.

Among the electric power equipments, the market of electric power generator equipments and high-end secondary equipments are highly concentrated, representing an obvious monopoly. The lead enterprises in these fields have little disparity from international companies in terms of technology; and they enjoy protection from the state regulations, so they are very competitive in the domestic market. However, domestic equipments market is in less concentrated, and the high-end market is quite impacted by the world enterprises. Therefore, the rat race will make the enterprises undertaking difficulties in maintaining steady profitability.

The high price of the steel will impact those enterprises' profitability that have long production period and high steel consumption, and some one-time equipment enterprises, therefore hold their steps of recovering. Although the steel price was reduced slightly recently, but the high quality steel, that the electric power equipment enterprises used most, is predicted to be decreased very little; and with  electric device enterprise' current  revenue, there's a great lag between steel cost and market price of merchandise on hand. Therefore, the enterprises' profitability won't rise till 2005.In contrast, the secondary device enterprises, which proportion of raw material is lower, have been affected to a less degree.

2.The upsurge of the investment drives fast-growing demands.
2.1 Electricity deficiency caused upsurge of power supply construction.
2.2 Steadily growing power grid construction.
2.3 Electric power equipment manufacturers enjoy the most benefits of electric investment upsurge.

3.Technological content of electric power equipment is in an ascending order
3.1 Generator sets required to be innovated. 
3.2 Electric grid equipments developing towards extra£­high voltage and automation.

4.Electric power equipment industry gets more concentrated 
4.1 Stronger gets stronger in the power equipments manufacturing.
4.2 Unevenness market distribution of the Equipment for power transmission and distribution.

5.The high price of steel slows down the recovering of power equipment manufacturers