Power market promotion slows down, officials urge electric reform

The “State Council’s Institutional Reform and Functional Transformation Plan” disclosed on the 10th shows that the National Energy Administration will be reorganized based on the integration of the existing National Energy Administration and the State Electricity Regulatory Commission.

This will mean that the Electricity Regulatory Commission established in 2003 and given the task of electric reform will become history.

An informed source from the SERC stated that under the current poor electricity system, the SERC has played a limited role in the electrical reform in the past decade, so its existence has lost its substantive role.

Just three days after being announced to restructure with the National Energy Administration, on the 13th, members of the National Committee of the Chinese People's Political Consultative Conference and the Vice Chairman of the State Electricity Regulatory Commission, Wang Yumin, called for an urgent need for coordinated reform of the institutional mechanisms.

Wang Yumin pointed out that on the basis of the separation of government and enterprises and the separation of plant and network, the node of the power system reform has already fallen into the field of power grids. It is necessary to change the operating system for the purchase and distribution of power grids, and to introduce independent transmission and distribution prices as the entry point to coordinate the advancement of transmission. The reform of the distribution system will also speed up the rationalization of the formation mechanism of electricity prices and promote changes in the electric power system.

Electric reform "There is still a certain distance"

Wang Shumin pointed out in the above article that the change of the operation system for the purchase and sale of power grids is the separation of transmission and sale of electricity. “Transmission does not sell electricity.” One of the transmission parties builds a power transmission channel and collects a “passage fee” for power grid construction and maintenance. The selling party is responsible for selling electricity and participating in market transactions.

“The mechanism of electricity price formation should be further marketized, that is, 'Marketization of the two's market and the government's regulation in the middle'.” Wang Yumin believes that the government should formulate an independent transmission and distribution tariff, while the on-grid price and sales price should be liberalized, and the on-grid tariff should be In conjunction with changes in coal prices, coal prices are fundamentally linked to electricity prices and transmitted to end-users, and ultimately determine the sales price of electricity under the influence of the market.

Wang Yumin also said that adhering to the principle of marketization and rationalizing the formation mechanism of electricity prices are particularly important for promoting the direct purchase of electricity by large consumers. The direct purchase of electricity by large users reflects the right of users to independently select electricity, which is closely related to the operating mechanism of electricity and has a direct bearing on electricity prices. The direct purchase of power by large users is regarded as a breakthrough for the Supervisory Commission trying to break through the bottleneck of electric reform. He believes that direct electricity purchases by large users to promote electricity market transactions can bring benefits to the deepening of power system reforms.

A very important but always despised issue is that Wang Yumin pointed out that China needs to expedite the revision of laws and regulations concerning electric reform and provide corresponding guarantees for reform. He admitted that work on the revision of the "Electricity Law", the drafting of the "Energy Law" and the "Power Supervision Law" are progressing, "but there is still a certain distance."

According to a person familiar with the aforementioned SERC, in recent years, the Electricity Regulatory Commission has been stressing “deepening the reform of the power system”, but the effect is almost zero.

The role of SERC is limited. The Electricity Regulatory Commission was established on the basis of the "Document No. 5" of the electric power reform in 2002 (ie, the "Electric Power System Reform Program"). Unlike the National Energy Administration of the sub-ministerial unit, the SERC is a positive ministerial institution. It has 6 regional electric supervisory bureaus and 12 electric supervisory offices. It has more than 2,000 employees so far.

Why set up the Electricity Regulatory Commission? Zhang Guobao, former member of the electric reform team and former director of the National Energy Administration, recalled that after separation of the plant and network, the power generation side formed a competitive relationship, but as a transmission and distribution power grid company, some On the other hand, it still maintains the monopoly's attributes. In order to achieve fair trade, an electric power regulatory agency is required. China then learned the British model and established the Electricity Regulatory Commission. At that time, the country’s leaders believed that the SERC was of great significance and should be given a positive ministerial level.

The duties of the SERC are to formulate rules for the operation of the electricity market, supervise market operations, and maintain fair competition; to propose pricing adjustments to the government's price authorities according to market conditions; to supervise and inspect the production quality standards of electric power companies and issue and manage electric power business licenses. Certification; handling power market disputes; responsible for supervising the implementation of universal social service policies.

However, during the actual operation, an informed source of the SERC told this reporter that the government has always “engaged in administrative approval” in the pricing of electricity prices, leading the Electricity Regulatory Commission, which is responsible for the supervision of the electricity market, to find no real-world work. The real electricity market can be supervised.

It is worth mentioning that the person familiar with the matter pointed out that despite the great opinions of the government on the pricing of the government, this time in the adjustment and reform of the whole organization, there was no mention of the price reform.

According to the information provided by the SERC's insider, Meng Dingzhong, the former senior engineer at the Production Department of the Ministry of Power and the current international giant CIGRE and the US IEEE member, told the reporter on the phone that the existing power system The existence of SERC did not play its due role. “In terms of power supervision, due to the strong power grid companies, there are many problems that the SERC cannot solve.” Meng Dingzhong said, “The SERC asked us several times to reflect the problem, but in the end we cannot solve it.”

It has been proved by practice that the electricity market in China has not been successfully established as expected after 10 years of electricity reform, and a reasonable electricity price mechanism has not yet been formed.

An insider of the CEC stated that the SERC was revoked and incorporated into the National Energy Administration. This shows that the pace of China's electricity reform will not go too fast. “We cannot criticize the Electricity Regulatory Commission,” he said. “The reason why the SERC has played a limited role is because China's electricity market is not well-developed. This has nothing to do with the SERC's own existence and the work itself.” He believes that if the electricity reform is to continue to take a step forward, this will require determination at the central level.