Review of mid-to long-term trading mechanism for renewable electricity consumption in Ningxia, China

Yunting Yao, Ciwei Gao, Hongjie Tian and Huiling Zhang

Renewable and Sustainable Energy Reviews, 2020, vol. 134, issue C

Abstract: As one of the major renewable energy (RE) generating provinces in China, Ningxia faces the difficulties of RE consumption. This paper reviews the regulatory framework, implementation motivation and relevant provisions regarding Ningxia's mid-to long-term trading mechanism on RE consumption. Currently, the introduction of RE in the electricity market squeezes the market share of thermal generators while the ancillary service market is yet to be established. Under such circumstance, Ningxia government adopts the generation contract transfer trading (GCTT) to ensure the cost recovering of thermal generators. Accordingly, this paper analyzes the strengths and weaknesses of the current mechanism, and proposes suggestions on the policy improvement and market mechanism optimization. Finally, the GCTT and decoupled trading modes are simulated through system dynamics based on the mid-to long-term RE trading mechanism. The simulation results reveal that the concession price ratio is the key factor regarding the development of RE in the GCTT mode. The ratio should be set dynamically based on the market factors. Besides, in the long run, the decoupled model is more suitable for the RE development, where the market balance, market prices and subsidies are the key factors.

Keywords: RE consumption; Mid-to long-term trading market; System dynamics; Generation contract transfer trading; Decoupled trading (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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DOI: 10.1016/j.rser.2020.110325

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