negotiated between the supply and demand parties, apart from a small amount of residential gas
necessary to maintain people’s living standards.
The market-oriented pricing system drove down
the price of natural gas, reducing the cost of gas
use for companies.
Second, regulation of the natural gas transmission tariff and distribution fee has been steadily strengthened. Following the principle of
“deregulating gas sources and retailing, and
controlling gas transmission and distribution”,
China introduced several policies to regulate
natural gas transmission and distribution. These
included measures for administering the gas
pipeline transmission tariff and for supervising
and reviewing pricing costs, which required the
cross-provincial gas pipeline operating companies to establish independent accounting processes before June 1, 2017. China also effected
measures for the supervision and administration
of local gas transmission tariffs and distribution
fees, requiring all provinces to introduce the
necessary support policies to reduce end-use gas
prices.
2.9.5 Policies to Promote
the Development
of Renewable Energy Are
Introduced
and an Assessment System
Is Developed
First, in 2016, a guiding framework for renewable energy development and use was introduced. China quantified the share of non-fossil
energy for the first time and clearly defined the
requirements to develop, connect and measure
renewable energy in all provinces.
Second, a system was developed to guarantee
the purchase of wind and solar power. In 2016,
China issued the Measures to Guarantee the
Purchase of Electricity Generated by Renewable
Energy and made public the volume of wind and
solar power purchased in all provinces. This was
an important institutional change to help reform
the legal and power systems, and a significant
starting point to guarantee grid connection of
renewable energy and ensure market access for
new energy in the future.
Third, the green certificate and trading system
for renewable energy was formed. The green
certificate is an evidence-based means for evaluating how well power supply companies are
delivering their planned share of non-hydro
renewable energy. As electricity system reform
continues and a carbon trading system is developed, market conditions for the green certificate
and trading system will gradually improve, and
the green certificate will become a channel to
secure new funding for renewable energy
projects.
2.9.6 Reform of State-Owned Energy
Enterprises Accelerates
First, China has developed the “1+N” policy. “1”
refers to the Guidelines on Deepening Reform of
State-owned Enterprises (2016). Specifically, 10
pilot reform projects were implemented in
accordance with the Guidelines and led by the
State-owned Enterprise Reform Steering Group
under the State Council. “N” stands for the
support pillars, which include the development of
a mixed ownership economy, improvement of
the state-owned asset management system,
supervision of state-owned assets to prevent their
erosion, development of a robust legal system,
introduction of equity and dividend incentives,
separation of social responsibilities previously
undertaken by state-owned enterprises (SOE),
supervision and management of state-owned
asset transactions, SOE restructuring, illegal
operations, investment accountability, employee
stock ownership pilot projects, and so on.
Second, China is improving corporate governance by forming pilot boards of directors. The
scope of the pilot includes China Baowu Steel
Group, State Development & Investment Corporation (SDIC) and China General Nuclear
Power Corporation (CGN). A system for
recruiting managers and professional executives
will be piloted at centrally run enterprises and
their subsidiaries, including SDIC and China
Railway Signal & Communication (CRSC).
Special Report 4: China’s Energy System Revolution
423
necessary to maintain people’s living standards.
The market-oriented pricing system drove down
the price of natural gas, reducing the cost of gas
use for companies.
Second, regulation of the natural gas transmission tariff and distribution fee has been steadily strengthened. Following the principle of
“deregulating gas sources and retailing, and
controlling gas transmission and distribution”,
China introduced several policies to regulate
natural gas transmission and distribution. These
included measures for administering the gas
pipeline transmission tariff and for supervising
and reviewing pricing costs, which required the
cross-provincial gas pipeline operating companies to establish independent accounting processes before June 1, 2017. China also effected
measures for the supervision and administration
of local gas transmission tariffs and distribution
fees, requiring all provinces to introduce the
necessary support policies to reduce end-use gas
prices.
2.9.5 Policies to Promote
the Development
of Renewable Energy Are
Introduced
and an Assessment System
Is Developed
First, in 2016, a guiding framework for renewable energy development and use was introduced. China quantified the share of non-fossil
energy for the first time and clearly defined the
requirements to develop, connect and measure
renewable energy in all provinces.
Second, a system was developed to guarantee
the purchase of wind and solar power. In 2016,
China issued the Measures to Guarantee the
Purchase of Electricity Generated by Renewable
Energy and made public the volume of wind and
solar power purchased in all provinces. This was
an important institutional change to help reform
the legal and power systems, and a significant
starting point to guarantee grid connection of
renewable energy and ensure market access for
new energy in the future.
Third, the green certificate and trading system
for renewable energy was formed. The green
certificate is an evidence-based means for evaluating how well power supply companies are
delivering their planned share of non-hydro
renewable energy. As electricity system reform
continues and a carbon trading system is developed, market conditions for the green certificate
and trading system will gradually improve, and
the green certificate will become a channel to
secure new funding for renewable energy
projects.
2.9.6 Reform of State-Owned Energy
Enterprises Accelerates
First, China has developed the “1+N” policy. “1”
refers to the Guidelines on Deepening Reform of
State-owned Enterprises (2016). Specifically, 10
pilot reform projects were implemented in
accordance with the Guidelines and led by the
State-owned Enterprise Reform Steering Group
under the State Council. “N” stands for the
support pillars, which include the development of
a mixed ownership economy, improvement of
the state-owned asset management system,
supervision of state-owned assets to prevent their
erosion, development of a robust legal system,
introduction of equity and dividend incentives,
separation of social responsibilities previously
undertaken by state-owned enterprises (SOE),
supervision and management of state-owned
asset transactions, SOE restructuring, illegal
operations, investment accountability, employee
stock ownership pilot projects, and so on.
Second, China is improving corporate governance by forming pilot boards of directors. The
scope of the pilot includes China Baowu Steel
Group, State Development & Investment Corporation (SDIC) and China General Nuclear
Power Corporation (CGN). A system for
recruiting managers and professional executives
will be piloted at centrally run enterprises and
their subsidiaries, including SDIC and China
Railway Signal & Communication (CRSC).
Special Report 4: China’s Energy System Revolution
423