China Energy Outlook 2020 - Flipbook - Page 98
Power Sector
Between 1980 and 2018, China’s electricity production increased dramatically, growing from
300 TWh to 6994 TWh. Power generation has always been and is still dominated by fossil fuels,
which produced 69% of China’s electricity in 2019, followed by hydropower (17.8%), wind
(5.5%), nuclear (4.8%), and solar (3.1%), with the remaining power produced by other
renewables such as biomass and geothermal (0.003%) (CEC, 2019b; CEC; 2020).
Table 2-17 provides information on the key energy-related policies and programs for the power
sector that are discussed here. Three of the five policies are regulatory/administrative, setting
targets and requiring specific actions regarding the types of power plants that can be
constructed as well as establishing rules to reduce curtailment of renewable power sources.
The other two policies rely predominately on economic measures to improve the efficiency of
China’s power grid, especially to allow the various power sources to compete on an economic
basis.
Table 2-17. China’s Key Energy-Related Policies and Programs: Power Sector
Policy/Program Type
Coverage
Current Status
Power Sector
Reform
Economic;
Informational
Reducing
Renewable
Electricity
Curtailment
Renewable Energy
Obligation
Scheme
Regulatory/
Administrative
Removal of PV
Subsidies and
Stimulation of
Grid Price Parity
of Renewables
Economic;
Motivational
Regulatory/
Administrative
Developing competitive
wholesale and retail electricity
markets nation-wide
National targets and specific
targets for key provinces to
reduce renewable energy
curtailment
Establish annual obligations for
each jurisdiction in China to
achieve minimum consumption
levels of electricity produced
from renewable energy;
launching Renewable Portfolio
Standards (RPS)
Removal of subsidies applicable
to China’s PV production industry
and enterprises
Addressing Coal- Regulatory/
Limit new coal-fired power
Fired Power Plants Administrative; plants, eliminate coal-fired power
Informational
plants using outdated
technology, and improve coal
power planning and construction
84
30% of electricity is competitively
procured; 8 spot market pilots
launched
Curtailment rates for wind and
solar reduced from double-digit to
7% and 3%, respectively
A renewable energy power
consumption annual obligation
created
Unexpected removal of PV
subsidies in May 2018 that China’s
PV industry has had to adapt to,
stimulating efforts towards
reaching the grid parity goal earlier
than expected
Created a set of policies and
established an early warning
system to address coal-power
overcapacity