The new electricity reform "resistance is so much"

2015 was considered as the “sprint year” for energy price reform. Among them, electric reform will bear the brunt. On December 31 last year, the “New Electricity Reform” program was formally adopted at the State Council’s executive meeting. According to media reports, during the two sessions of the National People's Congress this year, Nur Bekri, the deputy to the National People's Congress and the new director of the National Energy Administration, revealed that the new power reform plan is expected to be introduced six months later.

It can be said that electricity price reforms are in full swing. Whether the new plan can be successfully implemented and to what extent it can resolve the many persistent problems that plague the power industry, and whether it can break the institutional barriers and become a common topic of concern for everyone.

Break the "black box"

Although the new electricity reform plan has not yet been released, its main framework has become a "public secret." According to the reporter’s understanding, the main document entitled “Several Opinions on Deepening the Reform of the Electric Power System” can be summarized as “four liberalizations, one independence, and one strengthening”, that is, the opening and selling of operational electricity prices beyond distribution and distribution. The opening of the electricity business, the release of incremental distribution services, the release of Power Supply plans beyond the public welfare and regulation, and the independence of trading platforms to strengthen planning.

As the program shifted from the "contracted grid" of the controversy "separation of transmission and distribution" to the direction of "opening up two ends and monitoring the middle", it was called the "soft mode" electric reform.

The transmission price pilot is an important part of the electric reform program. It can change the profit model of the grid company from the 'eat differential price' to the approved income based on effective assets. It is necessary for the power grid companies to manage them in accordance with public utilities. No black box can be set up, and profits should be earned on both sides. There is no supervision. “Zeng Ming, director of the Energy and Power Economics Research Consultation Center of North China Electric Power University and expert on the power system reform expert advisory group of the National Development and Reform Commission, believes that the transmission price reform will not encounter too much resistance. “This is necessary and feasible, and the model is relatively mature. There are also international experiences. The grid companies are all state-owned enterprises and will be reformed according to the requirements of the country. ”

In addition, Zeng Ming believes that due to the current overcapacity problem, pilot direct purchases of electricity by large users in more provinces will be rolled out this year, and will be more standardized, in accordance with market rules, models and mechanisms.

However, Zeng Ming is not optimistic about the expansion of the trials for the more focused sales side of the Shenzhen pilot. It is reported that at present, Shenzhen has established an independent power sales company, and various private capitals have the opportunity to enter the power sales market.

Zeng Ming believes that the release of power-selling side involves obstacles such as supporting policies and price systems, especially cross-subsidies, and it is impossible to move quickly to the market in the short term. Therefore, this year may still do some research and development of detailed rules, and there will be no substantive action.

Promotion problems

The reason why the sale side opened up can be piloted in Shenzhen, thanks to the special nature of the Shenzhen power grid.

On November 4th last year, Shenzhen began trials of transmission and distribution price reforms. According to calculations, transmission and distribution tariffs per kilowatt-hour in Shenzhen in the next three years will fall by more than one cent, and grid revenue will decrease by a total of 2.4 billion yuan. "1 penny" appears to be inconspicuous, but it is obtained through the accounting grid company's allocation costs, which means that the game for many years the "black box" problem has finally been ripped apart, which is the biggest effect of the Shenzhen pilot.

The existence of a large number of cross-subsidies in China is one of the reasons why transmission and distribution prices are difficult to clarify. Since the cost of electricity for industrial and commercial use is lower than that of residential electricity, the electricity price for commercial and commercial use in most countries in the world is generally lower than the price for residential electricity. Our country has been subsidizing residential electricity consumption by raising the electricity price of industrial and commercial users, making civilian electricity prices at a relatively low level.

Shenzhen's urban power grids are dense, there are no rural power grids, and there are few cross-subsidies. With the active cooperation of China Southern Power Grid Corporation, Shenzhen Electric Power Reform is considered “easier” by many experts. "Shenzhen is rather special and not representative, but it needs to expand pilots," Lin Boqiang said.

After Shenzhen, Mengxi Power Grid allegedly will launch a pilot. However, there is a large amount of cross-subsidization in Mengxi. At the same time, as a place where renewable energy is available in China, Mengxi Power Grid has not reached a consensus with the National Grid on how to send new energy.

What are the obstacles to institutional reform?

In 2002, the round of power system reform established a 16-word goal of “separation of plant and network, separation of main and auxiliary facilities, separation of transmission and distribution, and online bidding”. However, after the completion of the separation of government and enterprises and the separation of factories and networks, the electrical reforms have stopped suddenly. Until now, neither the transmission nor the distribution has been achieved. Therefore, as the new leader of the Central Committee came to power, the power reforms that started again were placed high hopes.

However, compared with the popular call for "eliminating monopoly" and "opening up marketization," the new plan did not carry out drastic changes in the power system.

"Price reform must be coordinated with institutional reforms. System reform must be moved this year," Lin Boqiang pointed out.

To address this issue, Liu Zhenya, chairman of the Standing Committee of the National Committee of the Chinese People's Political Consultative Conference and the State Grid Corporation of China, stated during the two sessions of the National Committee this year that the electricity reform is not privatization. He said that the reform of power privatization in many countries has had a negative impact, and China is currently in the stage of development with public ownership as the main body, and state-owned enterprises must assume more responsibilities.

In response, Fan Bi, deputy director general of the Research Department of the State Council’s Research Office, who has always advocated the elimination of monopoly, also told reporters: “The reform cannot be achieved in one step.”

Zhou Dadi, deputy director of the China Energy Research Institute, said: "If we think that electricity reform is an anti-monopoly, we can solve all problems through anti-monopoly, and many contradictions in the power industry will not be solved, and reforms will be biased."

In fact, in Germany, where the process of energy transition is rapid, higher civilian electricity prices are considered to make reform easier to advance. In China, lower civilian electricity prices benefit from a large amount of cross-subsidization. Once the market is liberalized, civil prices will rise significantly. "These problems are not simply addressed to the market," said Zhou Da.

Zeng Ming also believes that it is impossible for reform to substantially increase the price of electricity for the people, especially for low-income groups. Under the current national conditions, the public utility of electricity is stronger than the characteristics of commodities, and it is impossible to achieve rapid marketization.

Lin Boqiang pointed out: "Big companies are the targets of reform, and they are certainly unwilling to reform. But if it is said that large companies decide whether or not to reform, it is not reliable. The determination is for the government to take. The core issue is to grasp the consequences and public acceptance. degree."

In fact, as long as there is no price increase, ordinary people will not pay too much attention to reform. Therefore, Lin Boqiang believes that as long as the price of electricity does not rise, electricity reform is not difficult. "From the current electricity system, as long as the price of coal does not rise, the price of electricity will not rise. What are you worried about? It will be even more difficult not to do it now. This is why I am particularly looking forward to this year's reform."