Reform of new energy storage pricing mechanism

Does China need a market-oriented electricity pricing mechanism?

Market-oriented electricity pricing mechanism needs to be further enhanced in China. Along with the cost reduction and the scaling up of renewable energy, China is phasing out its feed-in tariff (FIT) approach, a fixed pricing mechanism which has been applied to China’s wind and solar power for over a decade.

How important is the deregulation of the electricity pricing mechanism?

The deregulation of the electricity pricing mechanism is one of the key elements in the new round of electricity market reform and is of great significance to the development of renewable energy.

What is power market and pricing mechanism reform in China?

This report, Power Market and Pricing Mechanism Reform in China, helps build a bridge to help markets better support this new era of innovation. It focuses on three challenges: (1) zero-carbon power capacity development, (2) zero-carbon power consumption, and (3) system adequacy in zero-carbon power growth.

What is China's electricity price reform notice?

The notice aims to promote the full market entry of new energy generation and ensure that on-grid electricity prices are entirely determined by the market. This marks another significant step in China's electricity price reform on the generation side following the 2021 market-oriented reform of coal-fired power on-grid tariffs.

What is a fixed pricing mechanism?

A fixed pricing mechanism, also called feed-in tariff (FIT), is a mechanism under which the on-grid renewable energy price is determined by government rather than by competition, and the renewable energy producer usually enjoys government subsidy.

What are the 'firsts' of energy reform?

The reform introduces four key "firsts": 1、First-time Requirement for Full Market-Based Participation of All New Energy Generation The document stipulates that, in principle, all electricity generated by new energy projects (wind and solar power) must enter the electricity market, with on-grid prices determined through market transactions.