Notice of the 2023 Annual General Meeting

The resolutions hereunder contain the English translation of the Chinese version of "Meeting materials for the 2023 Annual General Meeting" as published on the website of the Shanghai Stock Exchange, and are provided for your reference only. In case of discrepancy between the Chinese version and the English version, the Chinese version shall prevail.

Proposal I

SDIC Power Holdings Co., Ltd.

2023 Work Report of the Board of Directors

Dear shareholders and shareholder representatives,

In the year 2023, facing new development trends and new industry pattern of the power sector, the Board of Directors of SDIC Power Holdings Co., Ltd. (hereinafter referred to as "SDIC Power" or "the Company") seized the opportunity to pursue progress while maintaining stability and promote stability through progress, focused on enhancing core functions and core competitiveness, overcame difficulties and worked hard. We hit a new high in our primary business results, saw reports of fresh success in business development and significant improvements in governance efficiency, and effectively safeguarded the legitimate rights and interests of our shareholders.

The work of the Board of Directors in 2023 and the work plan for 2024 are hereby reported as follows:

Part I    Work of the Board of Directors in 2023

I. Operating Achievements of the Company

The operating indicators of the Company continued to improve. By the end of 2023, the holding installed capacity was 40.8566 million kW; the total assets were RMB 277.363 billion, an increase of RMB 19.064 billion over the end of the previous period; and the asset-liability ratio was 63.18%, a decrease of 0.59 percentage points from the previous year.

There were no work safety accidents throughout 2023. The new installed capacity put into operation in this year totaled 3.0924 million kW, with a completed power generation of 161.973 billion kWh, up 3.35% year on year; the on-grid tariff was RMB 0.374/kWh, up 6.55% year on year. The annual operating revenue was RMB 56.712 billion, a year-on-year increase of 12.32%; the net profit attributable to shareholders of the Company was RMB 6.705 billion, a year-on-year increase of 64.31%; and the basic earnings per share was RMB 0.8754, a year-on-year increase of 67.86%.

II. Convening of Board Meetings

According to the relevant provisions of laws and regulations, as well as the Articles of Association and the Rules of Procedure of the Board of Directors, the Company held a total of 16 board meetings and deliberated 63 proposals in 2023, including the appointment of senior executives, system revision, related-party transactions, and other matters, ensuring the efficient and smooth operation of our business activities. All directors of the Company attended all the board meetings during the year and no absence occurred. The matters deliberated are as follows:

(I) Personnel changes

In 2023, Mr. Zhang Wenping, director and general manager, and Mr. Yang Lin, secretary of the Board of Directors, resigned from their positions due to a job adjustment. According to the relevant provisions of the Company Law and the Articles of Association, the Board of Directors of the Company efficiently carried out the selection and appointment of directors and senior executives.

In April 2023, according to the nomination by the Company's chairman, the Board of Directors agreed to appoint Mr. Yu Haimiao as the general manager. According to the nomination by the controlling shareholder of the Company, State Development & Investment Corp., Ltd. and with the approval by the third extraordinary general meeting of shareholders in 2023 through deliberation, Mr. Yu Haimiao was elected as a member of the Twelfth Board of Directors of the Company.

In July 2023, according to the nomination by the Company's general manager, the Board of Directors agreed to appoint Mr. Cai Jidong and Mr. Jing Zhentao as the deputy general managers of the Company.

In October 2023, according to the nomination by the Company's general manager, the Board of Directors agreed to appoint Mr. Gao Hai as the deputy general manager and secretary of the Board of Directors of the Company, and to appoint Mr. Zhou Changxin as the chief accountant (financial director) of the Company.

(II) System revision

In 2023, according to relevant requirements of the Administrative Measures for Compliance of Central Enterprises and other regulations, the Board of Directors agreed to revise the Articles of Association by adding compliance management functions of the Board of Directors and the Management, defining the positioning of senior executives including the general counsel and chief accountant (financial director), with the approval by the first extraordinary general meeting of shareholders in 2023 through deliberation.

In addition, in accordance with relevant requirements of the Administrative Measures for Compliance of Central Enterprises, the Notice on Issuing the Opinions on Further Strengthening the Development of Central Enterprises under the Rule of Law, and the Guidelines on Investor Relations Management of Listed Companies issued by the China Securities Regulatory Commission, the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation, etc., the Board of Directors presided over the revision of six systems, including the Administrative Measures for Remuneration of Persons-in-Charge, the Administrative Measures for Compliance, the Administrative Measures for Investor Relations, the Administrative Measures for Labor Costs, the Measures for Implementation of the "Three-Important and One-Large" Decision System, and the Administrative Measures for Investment Dividends, to further standardize the Company's operations and strengthen the compliance management, thus ensuring the stable development of the Company.

(III) Related-party transactions

As required by the needs of business development, the Board of Directors agreed the Company to sign a Financial Service Agreement with SDIC Finance Co., Ltd. and Rongshi International Treasury Management Co., Ltd. respectively, for a term of three years with the approval by the second extraordinary general meeting of shareholders in 2023 through deliberation. In December 2023, the Board of Directors deliberated and approved the estimates of daily related-party transactions for 2024.

(IV) Performance assessment and signing of performance contracts

According to the Administrative Measures for Performance Assessment of Senior Executives of the Company, the Board of Directors carried out the signing of performance contracts and employment contracts for senior executives in 2023.

(V) Guarantees

To implement the Company's international strategic planning and ensure the smooth progress of project construction, the Board of Directors deliberated and approved the guarantee provided by the parent company for Inch Cape Offshore Limited with a total amount of not exceeding GBP 25 million, with the approval by the fourth extraordinary general meeting of shareholders in 2023 through deliberation.

(VI) Periodic reports

The Board of Directors deliberated and approved the 2022 Annual Report and its summary, 2023 First-Quarter, Semi-annual and Third-quarter Reports of the Company to ensure true, accurate and complete disclosure of the Company's financial condition and operating results to the market.

(VII) Internal control

The Board of Directors deliberated and approved the 2022 Internal Control Evaluation Report of the Company, 2022 Enterprise-wide Risk Management Report of the Company, Internal Control Manual (2023 Edition) and Internal Control Standard Business Process (2023 Edition), and 2022 Internal Audit Work Report of the Company, all of which were prepared in accordance with regulatory requirements of the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation and the Company's rules and regulations.

(VIII) Profit distribution

The Board of Directors deliberated and approved the profit distribution matters for the year 2022, and proposed to the general meeting of shareholders that the profit distribution in 2022 should be based on the total share capital of 7,454,179,797 shares, and a cash dividend (including tax) of RMB 0.275 per share should be distributed, with a dividend ratio of 50%. It strictly followed the commitments in the Shareholder Return Plan for the Next Three Years (2021-2023) and was recognized by the majority of shareholders.

(IX) Changes to accounting policies

According to the Accounting Standards for Business Enterprises No. 16 issued by the Ministry of Finance on November 30, 2022, the Board of Directors deliberated and approved changes to accounting policies based on the actual conditions of the Company.

(X) Changes to the accounting firm

According to the relevant provisions of the Notice on Issuing the Administrative Measures for Selection and Appointment of Accounting Firms by State-owned Enterprises and Listed Companies, to ensure the independence and objectivity of audit work, the Board of Directors deliberated and approved the appointment of BDO China Shu Lun Pan CPAs (Special General Partnership) for the audit of financial statements and internal control of the Company for the year 2023, with the approval by the 7th extraordinary general meeting of shareholders in 2023 through deliberation.

III. Main Works Done during the Reporting Period

(I) Abiding by the rules strictly and performing duties diligently

In 2023, the Board of Directors proposed 8 general meetings of shareholders, including 1 annual General Meeting of Shareholders and 7 Extraordinary General Meetings of Shareholders, all of which were held by combining on-site voting with online voting. The proposals of all previous General Meetings of Shareholders were highly recognized by the majority of shareholders and successfully passed the vote.

In 2023, the professional committees of the Board of Directors held a total of 21 meetings, including 2 meetings for the Strategy Committee, 5 meetings for the Nomination Committee, 6 meetings for the Remuneration and Assessment Committee and 8 meetings for the Audit Committee. The Strategy Committee was deeply involved in the formulation of the Company's 2023 Operating Plan. The Company completed the interim revision of the "14th Five-Year Plan" Strategic Planning Report. The Strategy Committee evaluated the optimization and adjustments by the Company to the "14th Five-Year Plan" strategic planning to better guide the Company's development in the latter half of the "14th Five-Year Plan", and provided suggestions for the Board of Directors to formulate strategies and make scientific decisions. The Audit Committee actively maintained close communication with internal and external audit institutions, and paid attention to the necessity, fairness and pricing fairness of related-party transactions, as well as changes to accounting policies and the accounting firm. The Remuneration and Assessment Committee reviewed the remuneration situation and assessment performance results, and revised the Administrative Measures for Remuneration of Persons-in-Charge, the Administrative Measures for Labor Costs and other systems. The Nomination Committee strictly followed the nomination procedure and successfully completed the election of directors as well as the appointment of the general manager and senior executives of the Company.

In 2023, the independent directors gave full play to their respective professional advantages in the power industry, legal compliance, and accounting auditing, and conducted prior deliberations or expressed independent opinions on 19 matters or proposals such as related-party transactions, external guarantees, nomination, appointment and removal of directors, and changes in accounting policies. They were diligent and responsible, paid close attention to the Company's business dynamics, and put forward professional opinions and suggestions promptly. Within the year, they conducted two surveys on the Company, visited Fujian and Hainan for on-site inspections, understood the operating situation of the Company's controlling investment enterprises, and conducted in-depth exchanges and discussions on industry development. Meanwhile, they regularly communicated with the management of the Company according to work needs and actively safeguarded shareholders' rights and interests.

(II) Strengthening strategic guidance and adhering to high-quality development

In 2023, we achieved robust operating performance, continuously improved the sound output capacity of units, and optimized the hydropower cascade dispatching. We also strengthened fuel supply, focused on work safety management, and continuously enhanced the supply capacity. We completed the supply guarantee during important periods such as the Two Sessions and peak load in summer and winter, contributing to people's livelihood electricity and grid security and promoting economic and social development in many places. We fully exerted our core functions and fulfilled our corporate social responsibilities.

With the grid connection and power generation of major projects, we made many achievements in incremental development. With the solar power projects in Rinbung County and Nyima County put into operation, we achieved a breakthrough of zero installed capacity of new energy in Tibet, the roof of the world. The Kela Solar Power Station Phase I, the world's largest and highest hydro-solar hybrid power station, was completed in the Yalong River Basin. We overcame various challenges of Qinzhou Second Power, realized grid connection power generation of Unit 1 in Phase III on schedule, and achieved the planning goals of Guangxi Zhuang Autonomous Region. Many domestic new energy projects were approved or filed and the installed capacity maintained a rapid growth throughout the year. In terms of overseas projects, the Underground Diversion Tunnel of Batang Toru Hydropower Station was fully completed and the overall progress of the project is controllable and under control.

(III) Strengthening risk management and control and consolidating compliance management

Promoting the governance system through systems, we have formed a compliance management system with comprehensive coverage and clear responsibilities. We have amended our Measures for Implementing the Decision-making System of "Three-important and One-major" Matters, further standardizing the decision-making authority and process of governance entities in the Company. We have set up the system management framework for overseas enterprises, implemented the key areas of overseas control and domestic and foreign regulatory requirements, and systematically standardized the approval levels for subsidiaries' policies.

Strictly adhering to the bottom line against compliance risks, we establish a solid foundation for high-quality development. Clearly defining key management elements and bottom-line requirements, we have amended the Operation Compliance Management Manual for Enterprise Directors of SDIC Power, established a general contract template library for the Company, and conducted compliance and effectiveness evaluations in the fields of investment, mergers, acquisitions, and anti-monopoly. In addition, we fully realized the mid-term task indicators and key compliance management tasks of the "14th Five-Year Plan" for the rule of law, further optimizing our compliance management system. Focusing on controlling compliance risks in new energy projects, we conduct special training for new energy enterprises and communicate compliance requirements to prevent potential issues.

(IV) Actively optimizing governance and delivering corporate values

The Company strictly fulfilled the information disclosure obligation of listed companies and protected the right to know of investors. The Company continuously disclosed 62 Chinese announcements and 32 English announcements through the Shanghai Stock Exchange and London Stock Exchange throughout the year. With zero errors, zero supplements, and zero inquiries in terms of information disclosure, the Company has been awarded the "Grade A Rating of Information Disclosure" by the Shanghai Stock Exchange for seven consecutive years, establishing an image of robust, standardized, professional, and responsible player in the capital market.

The Board of Directors attached great importance to investor relationship management and constantly summarized the experience of interacting with investors through multiple channels. first, the Board of Directors established and improved various investor relationship management systems, laying a solid foundation for the construction of the organizational structure of investor relationship work. second, the Board of Directors delivered values and optimized efficient interaction mechanisms for investors across multiple levels. Within the year, it prepared and organized three online performance briefings and two offline performance briefings, with over 300 investors actively participating. It convened high-quality performance briefings to engage in in-depth exchanges with investors and conducted 84 investor exchanges, with 1,122 investor receipts throughout the year. Thirdly, it continued to attach great importance to the protection of the rights and interests of minority shareholders, obtained suggestions from the capital market, and presented investors with a corporate image with clear strategies, effective management, and excellent performance.

Part II  Work Plan of the Board of Directors in 2024

The year 2024 is a key year for achieving the Company's "14th Five-Year Plan" goals and a crucial year for implementing the action plan to deepen the reform of state-owned enterprises and the special action to improve the quality of listed companies of controlled subsidiaries of central enterprises. The Board of Directors will remain committed to fostering robust operations through continuous improvement, balancing high-quality development with superior safety standards, fulfilling energy supply responsibilities, driving green transformation initiatives, accelerating market capability building, and elevating our high-quality development to new heights. The main work plan is as follows:

I. Uniting Efforts for Development and Focusing on Enhancing Core Functions

Enhancing core functions and highlighting value creation. In the face of the complex and ever-changing external background in the power industry, coupled with multiple influencing factors, the Board of Directors will adhere to the coordination between stock efficiency improvement and incremental development. It is committed to accelerating the transition towards clean and low-carbon energy, serving the building of a new development landscape, comprehensively enhancing our value creation capabilities, elevating our high-quality development to new heights, and striving to reward our shareholders.

The energy industry is developing rapidly. With the rapid growth of energy demand in China, ensuring a safe and reliable power supply is an important core function of state-owned power enterprises. The development of a new power system has entered an important stage of accelerated promotion, and the competition in green transition has become more diverse. With the deepening of the reform of the power market and the continuous promotion of technological changes to adjust and upgrade the industrial structure, power enterprises shall seize the opportunity to take the initiative in pursuing change, actively adapting to changes, and creating new quality productive forces.

To keep up with the development trend of the power industry and firmly grasp the initiative of development, the Board of Directors will take on the task of energy supply with higher standards, promote the green and low-carbon transition with more determined steps, adapt to the trend of power marketization with more proactive actions, and enhance technological innovation capabilities with greater efforts.

II. Implementing the Green Transition Strategy and Accelerating Clean and Low-Carbon Development

Staying confident in the path of green transition, the Board of Directors will fully follow the national strategy of "Dual Carbon" goals, accelerate towards a clean and low-carbon development path, and continuously promote the development of new energy businesses.

The Board of Directors will follow the requirements of strategic control, revise the Company's "14th Five-Year Plan" for development during the interim, and further clarify the target for the installed capacity of new energy. Moreover, the Board of Directors will control the overall trend of energy and continue to make breakthroughs in business expansion. In the construction of the Yalong River Clean Energy Base, the Board of Directors will unremittingly promote the acquisition of new energy resources in the river basin, adhere to systematic thinking, and combine power transmission channel resources with local consumption capacity to steadily promote rolling development in the Yalong River Basin and persistently improve overall benefits. It will promote the development of new energy businesses based on the basic principles of benefit priority and regional coordination and actively strive for more resources.

The Board of Directors will take multiple measures and make unremitting efforts to strive for new energy projects, promote breakthroughs in multiple projects, actively achieve expected development reserve targets, and contribute to green development. In terms of infrastructure construction and production, it will arrange the progress reasonably and urge the early completion, early output, and early contribution of the installed capacity.

III. Ensuring Energy Security and Strengthening the Drive for Technological Innovation

Doing the utmost to ensure energy supply, the Board of Directors will enhance technological innovation capabilities to adapt to market trends, uphold the bottom line of work safety, and fulfill the social responsibilities of a central enterprise.

In China's current economic backdrop, the characteristic of higher growth in power load than power consumption has become increasingly apparent. To ensure a safe and reliable power supply, the Board of Directors will well manage work safety, solidly carry out the three-year action plan for fundamental work safety improvement, and promote system enhancement and infrastructure safety management. Moreover, the Board of Directors will achieve "four in place" in terms of standards, responsibilities, execution, and assessment, and ensure sound work safety. The Board of Directors will reinforce the implementation of responsibilities, equipment management, fuel supply, hydropower dispatching, and emergency security, and enhance power supply security capabilities through the "five reinforcements".

Technological innovation constantly promotes the adjustment and upgrading of the industrial structure, and the application of new technologies can significantly reduce the cost of power equipment. The Board of Directors will enhance technological innovation capabilities, increase resource investment, and encourage enterprises to solve key issues, make breakthroughs in key technologies, and promote the application of results. It will vigorously promote the application of new technologies, research and tackle technical difficulties in projects under construction, and accelerate the cultivation and development of new quality productive forces.

IV. Optimizing Internal Management and Steadily Improving Operation Efficiency

Operating existing assets well and exerting their due benefits is an important manifestation of the core competitiveness of the power business. The Board of Directors will focus on hydropower operation and management, stabilize thermal power performance, and accelerate the standardization and intensification of the management of new energy businesses. By promoting specialized construction, the Board of Directors will optimize management methods, consolidate the foundation for sustainable development, establish the core competitiveness of operation and management, and make greater contributions to performance.

The Board of Directors will continuously strengthen marketing efficiency, form a market-oriented mindset, and improve the professional and standardized management level of marketing. It will make good use of national policies and formulate flexible marketing strategies. Moreover, it will increase market development efforts and continuously strengthen communication and reporting with competent government authorities and trading institutions.

Guided by ensuring the promotion of the Company's key work, the Board of Directors will leverage the supporting role of human resources, continuously improve management effectiveness, and better match and support strategic implementation. It will explore and optimize incentive mechanisms under new situations to stimulate endogenous driving forces for high-quality development. It will continue to play the "baton" role of performance assessment, focus on performance contribution and value creation, constantly optimize the performance assessment system, unblock the transmission mechanism of responsibility pressure around the Company's key difficulties, strengthen the rigid fulfillment of assessments, and encourage attention to practical results and take the initiative to tackle difficulties and promote the effective implementation of work.

V. Promoting Value Delivery and Improving the Quality of Listed Companies

The Board of Directors will solidly carry out special work to improve the quality of listed companies, optimize the platform landscape, promote its functional performance, and facilitate improved governance and standardized operations. Furthermore, it will strengthen endogenous growth and innovative development, enhance market recognition and value realization, and ensure that the high-quality development of listed companies will be elevated to new heights.

The Board of Directors will establish a multi-level value delivery mechanism, continuously execute regulatory requirements from all parties, and solidly enhance corporate governance. It will strengthen investor relationship management, actively maintain good relations with investors, enhance the Company's image in the capital market, and build a comprehensive and multi-level value transmission work system. Adhering to the concept of sustainable development, it will establish a high-standard ESG "1+N" management system that is in line with the Company's reality and has the characteristics of SDIC Power, work together with stakeholders, and jointly create a green future.

In 2023, the work of the Company's Board of Directors proceeded smoothly under the support of shareholders. Focusing on the positioning of "the pioneer of clean energy and the leader in industry investment" and adhering to the core pursuit of "Brighten Nature, Brighter Power", the Company actively assumes environmental and social responsibility, actively accelerates participation in the construction of a new power system, and implements the national "Dual Carbon" strategy. The year 2024 marks the 75th anniversary of the founding of the People's Republic of China. Standing at a new historical starting point, the Board of Directors will continue to advance reforms, understand new characteristics and trends, embrace responsibilities, forge ahead, aim to become a globally-trusted investor & operator in integrated energy, and strive to write a new chapter of high-quality development.

The above proposal has been deliberated and approved at the 27th Meeting of the Twelfth Board of Directors on April 29, 2024, and it is hereby presented to you for deliberation and approval.

Proposal II

SDIC Power Holdings Co., Ltd.

2023 Work Report of the Supervisory Committee

Dear shareholders and shareholder representatives,

In 2023, the Supervisory Committee of the Company satisfactorily fulfilled all its work with the powers conferred by the Company Law and the Articles of Association of SDIC Power and safeguarded the legitimate rights and interests of the Company and all its shareholders. During the reporting period, the Supervisory Committee fulfilled its duties and effectively supervised the Company's legal enterprise governance, standardized financial operation, related-party transactions, changes in accounting policies, etc. The work of the Supervisory Committee in 2023 is reported as follows:

I. Meetings of Supervisory Committee in 2023

During the reporting period, the Supervisory Committee of the Company held a total of seven meetings according to the provisions of the Company Law and the Articles of Association, taking into account the Company's reality. All meetings of the Supervisory Committee were convened and chaired by the Chairman of the Supervisory Committee. All members of the Supervisory Committee attended each meeting, carefully reviewed and passed various proposals, and effectively fulfilled their duties of review and supervision. The convening of meetings of the Supervisory Committee, the exercise of supervisors' rights, and the resolution contents all comply with relevant provisions of the Company Law, the Articles of Association, and the Rules of Procedure of the Supervisory Committee.

The information on meetings of the Supervisory Committee is as follows:

II. Opinions of the Supervisory Committee on Relevant Matters in 2023

(I) Legal operation of the Company

In 2023, each supervisor inspected and supervised the Company's production and operation, financial status, decision-making on important matters, and other matters related to the interests of minority shareholders with a rigorous and prudent working attitude. The Supervisory Committee attended the meetings of the Board of Directors as a non-voting member and reviewed all the proposals of the Board of Directors. The Supervisory Committee believes that the decision-making procedures of the Board of Directors of the Company are legal, and finds no director or managerial force performs any acts that may harm the interests of shareholders of the Company while performing their duties, nor any other behavior that violates laws and regulations.

(II) Inspection of the Company's financial status

In 2023, the Supervisory Committee kept abreast of the Company's operation and financial situation, and reviewed documents submitted by the Board of Directors, including quarterly, semi-annual, and annual financial reports. The Supervisory Committee believes that the preparation and review procedures for the Company's periodic reports comply with the relevant provisions of laws, regulations, and the Articles of Association; the contents and formats of the Company's periodic reports conform to the relevant regulations of the China Securities Regulatory Commission and the Shanghai Stock Exchange, and the information contained therein fairly reflects the Company's financial status and operating results during the reporting period; BDO China Shu Lun Pan CPAs (Special General Partnership) has issued unqualified standard audit reports on the Company's 2023 annual financial report, which is objective and fair.

(III) Related-party transactions of the Company

During the reporting period, the Supervisory Committee continuously supervised the related-party transactions of the Company and believed that: the review procedures for the Company's related-party transactions were legal and effective, the principle of related-party pricing was fair, the related-party transactions met the needs of the Company's operation and development, and there was no damage to the interests of the Company and its shareholders, especially minority shareholders.

(IV) Use and management of the Company's raised funds

During the reporting period, the Supervisory Committee continuously supervised that the use and management process of raised funds complied with laws and regulations, reviewed the special report on the storage and use of raised funds in 2022 and a half year of 2023, checked the relevant progress of raised investment projects, and found no damage to the rights and interests of the Company and minority shareholders.

(V) Implementation of the internal control system and review of the evaluation report for internal control

During the reporting period, the Supervisory Committee reviewed the annual internal control evaluation report, understood the construction and operation of the internal control system, and gave full play to its supervision and guidance role. The Supervisory Committee believes that the Company has established a relatively complete internal control system, the existing internal control system meets the requirements of national laws and regulations, as well as the actual needs of the Company's current business operations, and it has been effectively implemented in the Company's business management, playing a good role in control and prevention; the internal control self-evaluation report of the Company can truly, completely, and objectively reflect the reality of the Company in the aspects of internal control, and the Supervisory Committee has no objection to the Board of Directors' internal control evaluation report.

(VI) Changes in accounting policies

The Supervisory Committee agreed to make changes to the Company's accounting policies according to the Accounting Standards for Business Enterprises No. 16 issued by the Ministry of Finance in 2022.

III. Outlooks

In 2024, the Supervisory Committee will continue to play its supervisory function, be diligent, responsible, timely, and efficient, maintain close communication with the management, ensure that the Board of Directors and the management of the Company carry out their work in strict accordance with the relevant provisions of the Company Law and the Articles of Association, implement the resolutions of the General Meeting of Shareholders, and safeguard the legitimate rights and interests of all shareholders.

In 2023, the work of the Company's Board of Directors proceeded smoothly under the support of shareholders. Focusing on the positioning of "the pioneer of clean energy and the leader in industry investment" and adhering to the core pursuit of "Brighten Nature, Brighter Power", the Company actively assumes environmental and social responsibility, actively accelerates participation in the construction of a new power system, and implements the national "Dual Carbon" strategy. The year 2024 marks the 75th anniversary of the founding of the People's Republic of China. Standing at a new historical starting point, the Board of Directors will continue to advance reforms, understand new characteristics and trends, embrace responsibilities, forge ahead, aim to become a globally-trusted investor & operator in integrated energy, and strive to write a new chapter of high-quality development.

The above proposal has been deliberated and approved at the 14th Meeting of the Twelfth Supervisory Committee on April 29, 2024, and it is hereby presented to you for deliberation and approval.

Proposal III

SDIC Power Holdings Co., Ltd.

Report on Final Accounts of the Company for 2023

Dear shareholders and shareholders' representatives,

Based on the audit by BDO China Shu Lun Pan CPAs (Special General Partnership), the Company achieved a total profit of RMB 14.215 billion in 2023 and the net profit attributable to the owners of the parent company of RMB 6.705 billion. As of December 31, 2023, the total assets in the Company's consolidated statements were RMB 277.363 billion, and the total equity attributable to owners of the parent company was RMB 59.067 billion, with an asset-liability ratio of 63.18%.

I. Key Financial Indicators in 2023

                                 Unit: RMB 10,000 Currency: RMB

In 2023, the Company achieved annual operating revenue of RMB 56.712 billion, a year-on-year increase of 12.32%, mainly due to the year-on-year increase in on-grid energy and average on-grid tariff; the net profit attributable to the owners of the parent company was RMB 6.705 billion, a year-on-year increase of 64.31%; and the earnings per share was RMB 0.8754, a year-on-year increase of 67.86%.

The specific analysis of main operating revenues and operating costs is as follows:

In 2023, the Company achieved a main operating revenue of RMB 56.312 billion, an increase of RMB 6.226 billion or 12.43% over 2022. There are two main reasons: first, the thermal power sector increased and rushed for power generation, resulting in a 14.93% year-on-year increase in on-grid energy, leading to an increase in revenue; second, at the end of last year and in the middle of this year, new units were put into operation, increasing the installed capacity and a year-on-year increase in revenue.

The main business revenue of thermal power was RMB 22.874 billion, an increase of RMB 2.647 billion over 2022. The main reason is that thermal power enterprises actively participated in spot market transactions this year, rushing for power generation when hydropower output was insufficient, resulting in a year-on-year increase in power generation, leading to an increase in revenue.

The main business revenue of hydropower was RMB 25.575 billion, an increase of RMB 1.808 billion over 2022. There are two main reasons: first, the tariff from Sichuan to Jiangsu rose this year; second, the Company actively participated in market transactions this year and the settlement tariff was high.

The main business revenue of wind power was RMB 2.879 billion, an increase of RMB 525 million over 2022. There are two main reasons; first, Longtian Wind Power, which was acquired by the Company at the beginning of the year, and Hangjinqi Wind Power, Longmen Wind Power Phase III, and Beiqi Wind Power, which were connected to the grid for power generation at the end of last year, achieved profitability throughout the year, increasing power generation; second, Laba Mountain Wind Power, Ninghe Wind Power Phase II, and Qinzhou Dongyong Wind Power were put into operation this year, increasing the installed capacity and resulting in an increase in power generation and a year-on-year increase in revenue.

The main business revenue of solar power generation was RMB 1.676 billion, an increase of RMB 411 million over 2022. There are two main reasons: first, the newly installed Guazhou Solar Power Station and Pingtang Leyang Solar Power Station last year achieved profitability throughout the year, increasing power generation; second, this year, new solar power stations such as Kola Solar Power Station and Naomao Lake South Solar Power Station were added, increasing the installed capacity and resulting in a year-on-year increase in revenue.

The main business revenue of waste-to-energy generation was RMB 112 million, down RMB 21 million over 2022, and the main reason is that the tariff of C&G Environmental Protection (Thailand) declined this year, leading to a decrease in tariff revenue.

The main operating revenue of other businesses was RMB 3.198 billion, an increase over 2022. There are two reasons; first, the heating business revenue significantly increased this year; second, the construction progress of the Batang Toru Project was improved compared to the previous year, resulting in an increase in revenue for the confirmed construction period.

In 2023, the main operating costs of the Company totaled RMB 36.011 billion, an increase of RMB 1.886 billion or 5.53% over 2022, including:

The main operating cost of thermal power was RMB 20.407 billion, down RMB 221 million over 2022, due to the decrease in overall coal costs affected by the decrease in coal prices this year.

The main operating cost of hydropower was RMB 10.191 billion, an increase of RMB 1.057 billion over 2022, mainly due to the year-on-year increase in depreciation expenses of the Yalong Hydro's hydropower stations in the middle reaches were put into operation this year.

The main operating cost of wind power was RMB 1.228 billion, an increase of RMB 234 million or 23.48% over 2022, mainly due to the increase in the installed capacity of wind power from the addition of Ningxiang Gushanfeng and Laba Mountain Wind Power this year and the increase of depreciation costs.

The main operating cost of solar power generation was RMB 758 million, an increase of RMB 187 million or 32.69% over 2022, mainly due to the increase in depreciation scale since new solar power projects such as Dachaoshan West Phase II and Pubei Yuansheng Distributed Solar Power were added this year and new projects put into operation at the end of last year operated throughout the year.

The main operating cost of waste-to-energy generation was RMB 77 million, basically the same as that of 2022.

The main operating cost of other businesses was RMB 3.35 billion, an increase of RMB 628 million or 23.08% over 2022. There are two main reasons: first, it was affected by the rise in heating business volume and coal costs; second, the construction of the Batang Toru Project was promoted year-on-year and the operating cost increased accordingly.

II. Profit Realization of the Company's Important Holding Companies in 2023

Unit: RMB 10,000 Currency: RMB

As for the large fluctuations in the operating performance of major investment companies, the analysis is as follows:

Unit: RMB 10,000 Currency: RMB

III. External Investment of the Company

In 2023, the headquarters of the Company completed an external capital investment of RMB 3.726 billion. The details are as follows:

Unit: RMB 10,000 Currency: RMB

IV. Assets Impairment

In 2023, the Company incurred a total impairment loss of RMB 397,502,200 million within the scope of consolidation, including an asset impairment loss of RMB 249,952,100 and a credit impairment loss of RMB 147,550,100.

The main provision for impairment is as follows:

Unit: RMB 10,000 Currency: RMB

V. Guarantee

Unit: RMB 10,000 Currency: RMB

VI. Cash Flow

Unit: RMB 10,000 Currency: RMB

The above proposal has been deliberated and approved at the 27th Meeting of the Twelfth Board of Directors on April 29, 2024, and it is hereby presented to you for deliberation and approval.

Proposal IV

SDIC Power Holdings Co., Ltd.

Proposal on 2024 Operation Plan

Dear shareholders and shareholder representatives,

The year 2024 marks a key year to fully implement the spirit of the 20th CPC National Congress and a crucial year for implementing the "14th Five-Year Plan". In 2024, China's economy is expected to continue its recovery trend, supported by the reinforcement and effectiveness improvement of China's macro policies, accelerated cultivation of new growth drivers, accelerated release of reform dividends, accelerated manifestation of the benefits of opening up, and a faster replenishment of the output gap. This will underpin the robust growth of China's economy, with an estimated GDP growth rate of about 5%.

Regarding the power market, according to the forecast of the China Electricity Council, total electricity consumption across society in 2024 is expected to reach 9.8 trillion kWh, representing an increase of about 6% over 2023. Additionally, it is estimated that the newly commissioned installed capacity of power generation in 2024 will exceed 300 million kW again, and the cumulative installed capacity of new energy power generation will surpass the installed capacity of coal-fired power generation for the first time.

Regarding the coal market, taking into account the trends of the coal market in 2023 and changes in coal demand, it is estimated that the coal supply and demand in 2024 may be slightly relaxed, with the market supply and demand remaining broadly balanced. Overall, energy demand is expected to grow steadily, and coal supply and demand will remain balanced. However, due to factors such as resource conditions, regional differences, hydropower and new energy development, and climate change, structural and seasonal tensions in coal supply will persist. As such, continued attention will be paid to factors such as the trends of international imported coal, domestic raw coal production, and port inventories.

In the face of complex internal and external environments, the Company will strengthen forward-looking analysis, innovate development models, continuously improve value creation capabilities, enhance core competitiveness, build a solid bottom line for risk prevention and control, constantly promote high-quality development, and create better returns on investment for shareholders.

The main business plans for 2024 are as follows:

I. Power Generation Plan

In 2024, it is estimated that SDIC Power will complete 178.6 billion kWh of power generation within the scope of consolidation. Among them, the power generation capacity of various power sources of the Company is listed below:

Unit: 100 million kWh

II. Headquarters' Cost Plan

In 2024, the planned annual expenditure of SDIC Power Headquarters is RMB 590 million, including taxes and surcharges of RMB 1 million, administration expenses of RMB 290 million, and financial expenses of RMB 300 million.

III. Annual Investment Expenditure Plan

In 2024, SDIC Power plans to invest RMB 6.41 billion in equity and RMB 34.65 billion in capital construction, mainly used for the development of hydropower and new energy projects.

IV. Annual Financing Plan

In 2024, SDIC Power Headquarters plans to raise a total of RMB 21 billion in annual domestic financing, which is planned to be met by public issuance of corporate bonds medium-term notes, or renewable bonds, or through loans from financial institutions such as SDIC Finance Co., Ltd. and banks.

SDIC Power and its overseas wholly-owned subsidiaries plan to raise a total amount of RMB 3.85 billion in foreign currencies equivalent, which is planned to be solved through loans from Rongshi International Holding Co., Ltd., its subsidiaries, and financial institutions.

In order to ensure the smooth business development of the Company, the SDIC Power Headquarters intends to apply for a total credit line of no more than RMB 35 billion from financial institutions, including but not limited to loans, letters of guarantee, letters of credit, and other comprehensive credit business.

The above proposal has been deliberated and approved at the 27th Meeting of the Twelfth Board of Directors on April 29, 2024, and it is hereby presented to you for deliberation and approval.

Proposal V

SDIC Power Holdings Co., Ltd.

Proposal on 2023 Profit Distribution Plan

Dear shareholders and shareholders' representatives,

SDIC Power Holdings Co., Ltd. (hereinafter referred to as "the Company") was audited by BDO China Shu Lun Pan CPAs (Special General Partnership). According to the audit, the net profit attributable to the owner of the parent company in the 2023 annual consolidated statement of the Company is RMB 6,704,936,953.85, and the net profit achieved in the statement of the parent company is RMB 3,621,346,814.36. According to the provisions set out in the Articles of Association and Shareholder Return Plan for the Next Three Years (2021-2023), the 2023 annual profit distribution plan is proposed as follows:

I. Distributable Profits

In accordance with the Accounting Standards for Business Enterprises - Merger and the distributable profits of the parent company, the distributable profits of the Company in 2023 are as follows:

Unit: RMB  Currency: RMB

According to the relevant laws and regulations and the Articles of Association of the Company and considering the interests of shareholders and the business development needs of the Company, the Board of Directors hereby submit the 2023 Profit Distribution Plan as follows:

1. The legal accumulation fund shall be accrued as 10% of the net profit of the parent company;

2. Cash dividends will be distributed as RMB 0.4948 per share (tax-inclusive), accounting for more than 55% of the net profit attributable to the parent company in the consolidated statement of the Company in 2023.

II. 2023 Dividend Distribution Plan

Based on the total share capital of 7,454,179,797 shares at the end of 2023, a cash dividend (tax-inclusive) of RMB 0.4948 per share was distributed, and a total cash dividend of about RMB 3,688,328,163.56 was distributed, accounting for 55% of the net profit attributable to the owners of the parent company in 2023.

Dividend Distribution Plan of the Company in Recent Three Years

Unit: RMB  Currency: RMB

The cumulative cash dividend amount in the last three years accounts for about 158% of the average annual net profit of the Company's merger in the last three years.

III. Notes

Maintaining continuity and stability of the profit distribution policy, the Company has continuously implemented a prudent cash dividend and profit distribution plan since the listing while considering the Company's long-term interests, the overall interests of all shareholders, and the Company's sustainable development. This profit distribution plan complies with the objective conditions of the Company and the provisions of relevant laws, regulations, normative documents, and the Articles of Association, and will not affect the normal operation and long-term development of the Company.

The above proposal has been deliberated and approved at the 27th Meeting of the Twelfth Board of Directors on April 29, 2024, and it is hereby presented to you for deliberation and approval.

Proposal VI

SDIC Power Holdings Co., Ltd.

Proposal on Amending the Articles of Association

Dear shareholders and shareholder representatives,

The Company proposed to amend its Articles of Association and make industrial and commercial registration of changes according to the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies and the Administrative Measures for Independent Directors of Listed Companies issued by the China Securities Regulatory Commission and the Guidelines for Articles of Association of Listed Companies (Revised in 2023) and the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation issued by Shanghai Stock Exchange, with details as follows:

I. Reasons and Main Contents of Amendments to the Articles of Association

(I) The Notice on Implementing the Essential Articles of Association for Overseas Listed Companies has been abolished by the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (issued on February 17, 2023, and implemented on March 31, 2023) and some provisions have been deleted and revised.

(II) According to the Administrative Measures for Independent Directors of Listed Companies issued in 2023, provisions on the proposal of independent directors to convene an extraordinary General Meeting of Shareholders, the nomination of independent director candidates, and obligations and authorities of independent directors have been amended.

(III) Some provisions have been added or deleted according to the Guidelines for Articles of Association of Listed Companies (Revised in 2023) and the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation.

II. Clauses Amended in the Articles of Association

It is proposed to amend the following clauses in the Articles of Association of SDIC Power (see the table below):

The above proposal has been deliberated and approved at the 28th Meeting of the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to you for deliberation and approval (as special resolution).

Proposal VII

SDIC Power Holdings Co., Ltd.

      The Proposal on Amending the Rules of Procedure    

         of the General Meeting of Shareholders

Dear shareholders and shareholder representatives:

Based on the operation context, the Company proposed to amend the Rules of Procedure of the General Meeting of Shareholders according to the Administrative Measures for Independent Directors of Listed Companies, the Guidelines for Articles of Association of Listed Companies (Revised in 2022), the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation (Revised in December 2023), the Rules of the General Meeting of Shareholders of Listed Companies (Revised in 2022), other regulations and the Articles of Association, with details as follows:

The above proposal has been deliberated and approved at the 28th Meeting of the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to you for deliberation and approval (as special resolution).

Proposal VIII

SDIC Power Holdings Co., Ltd.

Proposal on Amending the Rules of Procedure of the Board of Directors

Dear shareholders and shareholders' representatives,

Based on the operation context, the Company proposed to amend the Rules of Procedure of the Board of Directors according to the Administrative Measures for Independent Directors of Listed Companies, the Guidelines for Articles of Association of Listed Companies (Revised in 2022), the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation (Revised in December 2023), other regulations and the Articles of Association, with details as follows:

The above proposal has been deliberated and approved at the 28th Meeting of the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to you for deliberation and approval (as special resolution).

Proposal IX

SDIC Power Holdings Co., Ltd.

Proposal on Amending the Working System of Independent Directors

Dear shareholders and shareholders' representatives,

To fully leverage the role of independent directors and further improve its corporate governance structure, the Company plans to amend the Working System of Independent Directors of SDIC Power Holdings Co., Ltd. according to the Administrative Measures for Independent Directors of Listed Companies issued by the China Securities Regulatory Commission, the Rules Governing the Listing of Stocks on Shanghai Stock Exchange, and the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation.

The major amendments are as follows:

I. The qualification requirements for independent director candidates have been updated according to the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized Operation;

II. According to the Administrative Measures for Independent Directors of Listed Companies, the independence requirements, responsibilities and performance methods, appointment and dismissal requirements, and performance guarantees of independent director candidates have been correspondingly amended, and other contents related to special meetings for independent directors have been added.

For other specific details, please refer to the full text of the system in the annex.

The above proposal has been deliberated and approved at the 28th Meeting of the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to you for deliberation and approval.

Annex

SDIC Power Holdings Co., Ltd.

Working System of Independent Directors