Regulatory Pathways For Smart Grid Development in China
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The study’s recommendations describe institutional elements in the context of electric power sector regulation and has the objective to increase the understanding of the interdependencies of the institutional elements. In future work, the study results might be employed for designing very specific regulatory policies. The recommendations developed in this study focus primarily on the regulatory framework for smart grids and contains a quite detailed description of how the German electricity markets evolved. It also focuses on the effects of ambitiously expanding generation capacities of renewable energy sources (RES) on established electricity markets. The presented evidence will provide insights on how the regulatory framework in China could be designed to foster smart grids developments in the context of establishing electricity markets and expanding RES generation capacities.
pricing for residential consumers is being tested in the provinces. For the most part, China’s electricity is still being traded at governmentally fixed prices. Elements such as futures markets, balancing markets, or capacity markets used in other countries have not yet been implemented in China. The following advances are planned until 2020 (see Fig. C.3): In the power generation area, various energy sources are projected to have a place in the Chinese power system of 2020. All of them will be
regulator The need for a powerful regulator is more obvious: The competences of the regulator need to be laid down in a law so that decisions can be enforced and challenged in court. In Europe, it has been extensively debated whether the liberalized parts of the energy sector could be regulated under a general competition law or whether sector-specific legislation is necessary to ensure the development of competition. The test of practical experience, for example in Germany, has shown
upgrade In the scenario focusing on reliability and security of supply, network regulation is somewhat less important but not irrelevant. It contributes indirectly to this scenario, as it sets economic incentives for the build-up and maintenance of the grid infrastructure. Incentives for efficient network investments and investments in R&D and innovation are important in the context of the measures within this recommendation. These incentives, by contributing to the introduction of smart grid
introduced in the medium term. After network charges have been fixed, disaggregated regulation can be introduced. Due to the high impact of disaggregated regulation on competition in the retail sector, this measure should also be implemented in the medium term. Before network regulation can be established, the responsibility for network regulation has to be defined and an independent and powerful regulator is necessary. Facilitate the development of a unified view of smart grids As mentioned
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