The Company will continue to develop based on the Beijing-Tianjin-Tangshan area and at the same time to expand strategic planning power projects in regions where the cost, market or policies are favorable.

(1)The Company will focus on the continued development in the Northern China which is a cost-effective area. Northern China has abundant coal resources, the most important raw material in the Company's production operating process. So the Company can keep operating cost low through very low purchase and transport cost so as to optimize the company's competitive edge.

(2)The Company will, on the basis of maintaining its market share in northern China and the western region and, through its rational distribution of newly-developed projects, further develop the eastern coastal markets. It will distribute its power generation assets strategically in the economically-developed but electricity-lacking region. In this region, the Company will deploy high-capacity, highly efficient generating units. These units will also need to meet the state's environmental protection requirements at the initial stage of design and construction, so as achieve superior standards in power generation technology. The economy of the eastern coastal region has been developing rapidly with a commemorate strong demand for electricity, and so the market advantage is very obvious. At the same time, having experienced several years' rapid development, the business sector and common residents in the eastern region are able to bear higher power tariffs, which will greatly enhance the future profitability of the Company.

(3)The Company plans to emphasis the development in western power markets where policies are favorable. At the present time, the Chinese government is actively stimulating the economy of the western regions through some policies which favor development in these region. The transmission of power from western China to the eastern China is one of the country's strategic investment plans. The Company is exploiting several power projects in Yunnan, Gansu province and Inner Mongolia municipality because of the lower coal costs and abundant water resources and at the same time there are many supportive and favorable government policies in western China .