Reform and renewables in China: The architecture of Yunnan's hydropower dominated electricity market

ArticleinRenewable and Sustainable Energy Reviews 94:682-693 · October 2018with 68 Reads
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    This paper discusses the main competition issues that arise in electricity systems dominated by hydro generation, arguing that technological differences between hydro and thermal plants may allow hydropower producers to exert market power in different and subtler ways compared to thermal generators. The key for market power in hydro-based systems is the strategic allocation of a given amount of output across periods, rather than a straightforward reduction of total output. The paper examines the interaction between strategic hydro reservoir operation and transmission capacity constraints, and summarizes the implications of market power for system reliability. A review of recent relevant literature is included. Finally, possible interventions to mitigate market power are analysed.
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    Despite considerable progress in understanding electricity markets and how best to introduce market reform, many design and implementation issues remain. At a more fundamental level, there is no consensus on which model would work best in a given situation and what constitutes a “functional” market.
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    Deregulation was launched as a concept in the United States more than a decade ago; the European Union Commission has also formally announced that electric deregulation must be completed by the end of 2005. Deregulation or reform has already been a popular topic on the Electricity Power Sector. This paper will discuss the restructuring and regulatory reforms in the PR China's power sector. It begins with a discussion of the characteristics of electricity reform or deregulation in other countries, including the US, the United Kingdom, and so on. It will be followed by the industry structure and regulatory framework that characterized China's power industry during the latter part of the 20th century and the history of China's reform to restructure the power industry to competitive suppliers of generating services in recent years. It discusses the role of the State Power Corporation in the reform and gives a detailed description of the latest electricity reform in the year 2002. The paper concludes with some thoughts regarding future challenges and trends on the reform for China's power sector.
  • Conference Paper
    This paper examines principles of market design as applied to electricity markets. The author illustrates the principles with examples of both good and bad designs. The author discusses one of the main design challenges - dealing with market power. The author then discusses FERC's choice of a standard market design.