documents and mandatory standards and specifications form the legal basis for energy regulation, and they all play their part in modifying and
regulating energy development.
The legal foundation of China’s energy regulation system is spread across various energy
laws and regulations, with some parts of the
energy sector subject to several different energy
laws and regulations. The laws that can be used
as the basis for energy regulation include the
Mineral Resources Law of the PRC, the Electric
Power Law of the PRC, the Coal Industry Law of
the PRC and the Energy Conservation Law of the
PRC. There are also some provisions on energy
regulation in other related laws, such as the
Water Law of the PRC, the Environmental Protection Law of the PRC, the Law of the PRC on
Prevention and Control of Radioactive Pollution
and the Production Safety Law of the PRC.
Beyond this, the departmental regulations passed
by the State Council and by ministries and
commissions serve as the basis for supervision of
various energy sectors, for example the Regulation on Electric Power Supervision (2005) and
the Regulation on the Emergency Response to
and Investigation and Handling of Electric Power
Safety Accidents (2011). The former State
Electricity Regulatory Commission (SERC)
introduced more than 60 regulations on supervision and more than 160 normative documents.
Finally, the mandatory standards and specifications set the limits and procedures for key energy
sectors, so they provide the most direct basis for
supervision.
3.5.2 Analysis of Problems
In general, China’s energy regulation lacks
independence, is positioned at a low administrative level, needs higher standards of professionalism, and has difficulty carrying out the
supervision needed of a modern energy market.
As a result, there is not enough consistent and
effective supervision in key energy sectors,
especially in natural monopolies.
(1) Supervisory agencies are positioned at a
lower administrative level and they are
not independent
First, there is currently no independent high-level
energy regulatory agency. An approach that
bundles administration and regulation together
has been in use for years. During this time there
has been no independent, dedicated agency
responsible for energy regulation. This lack of
independence has severely restricted how energy
regulation is carried out.
Second, the existing energy regulation agencies are at a lower administrative level. Among
the major agencies that perform energy regulation, the NEA is at the department/bureau level
and the NDRC is at the division level. Only the
National Nuclear Safety Administration is relatively independent; it is a national agency
administered by the Ministry of Environmental
Protection on behalf of the central government.
However, the special nature of nuclear safety
supervision makes it different to most other types
of energy regulation.
Third, there is no national agency that consistently carries out energy regulation. The
decentralised nature of supervision has prevented
the synergies from the energy regulation system
as a whole being realised, so that often a situation
arises where many parties have responsibility for
something, but none of them delivers anything.
When the NEA was formed in 2013 it was given
the energy regulation function, but there are more
than 10 national government departments
involved in energy sector supervision for oil and
gas, power, coal, nuclear power, renewable
energy and others.
Fourth, when it comes to supervisory efficiency, the excessively decentralised regulatory
function increases the difficulty of coordinating
supervisory activities, which compromises efficiency to some extent. The contradictions and
conflicts between various departments, and
between central and local government, are
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S. Yaodong and A. Gillespie
regulating energy development.
The legal foundation of China’s energy regulation system is spread across various energy
laws and regulations, with some parts of the
energy sector subject to several different energy
laws and regulations. The laws that can be used
as the basis for energy regulation include the
Mineral Resources Law of the PRC, the Electric
Power Law of the PRC, the Coal Industry Law of
the PRC and the Energy Conservation Law of the
PRC. There are also some provisions on energy
regulation in other related laws, such as the
Water Law of the PRC, the Environmental Protection Law of the PRC, the Law of the PRC on
Prevention and Control of Radioactive Pollution
and the Production Safety Law of the PRC.
Beyond this, the departmental regulations passed
by the State Council and by ministries and
commissions serve as the basis for supervision of
various energy sectors, for example the Regulation on Electric Power Supervision (2005) and
the Regulation on the Emergency Response to
and Investigation and Handling of Electric Power
Safety Accidents (2011). The former State
Electricity Regulatory Commission (SERC)
introduced more than 60 regulations on supervision and more than 160 normative documents.
Finally, the mandatory standards and specifications set the limits and procedures for key energy
sectors, so they provide the most direct basis for
supervision.
3.5.2 Analysis of Problems
In general, China’s energy regulation lacks
independence, is positioned at a low administrative level, needs higher standards of professionalism, and has difficulty carrying out the
supervision needed of a modern energy market.
As a result, there is not enough consistent and
effective supervision in key energy sectors,
especially in natural monopolies.
(1) Supervisory agencies are positioned at a
lower administrative level and they are
not independent
First, there is currently no independent high-level
energy regulatory agency. An approach that
bundles administration and regulation together
has been in use for years. During this time there
has been no independent, dedicated agency
responsible for energy regulation. This lack of
independence has severely restricted how energy
regulation is carried out.
Second, the existing energy regulation agencies are at a lower administrative level. Among
the major agencies that perform energy regulation, the NEA is at the department/bureau level
and the NDRC is at the division level. Only the
National Nuclear Safety Administration is relatively independent; it is a national agency
administered by the Ministry of Environmental
Protection on behalf of the central government.
However, the special nature of nuclear safety
supervision makes it different to most other types
of energy regulation.
Third, there is no national agency that consistently carries out energy regulation. The
decentralised nature of supervision has prevented
the synergies from the energy regulation system
as a whole being realised, so that often a situation
arises where many parties have responsibility for
something, but none of them delivers anything.
When the NEA was formed in 2013 it was given
the energy regulation function, but there are more
than 10 national government departments
involved in energy sector supervision for oil and
gas, power, coal, nuclear power, renewable
energy and others.
Fourth, when it comes to supervisory efficiency, the excessively decentralised regulatory
function increases the difficulty of coordinating
supervisory activities, which compromises efficiency to some extent. The contradictions and
conflicts between various departments, and
between central and local government, are
444
S. Yaodong and A. Gillespie