Designing a National Inertia Trading Market with Chinese Characteristics

Mengqing Liu ()
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Mengqing Liu: Tianjin University, College of Management and Economics

A chapter in Proceedings of the 2023 2nd International Conference on Economics, Smart Finance and Contemporary Trade (ESFCT 2023), 2024, pp 331-338 from Springer

Abstract: Abstract The rapid development of new energy has led to insufficient rotational inertia, putting significant challenge on the safe and stable operation of the power system. As the world’s largest energy consumer and carbon dioxide emitter, China is making commitment to realizing its dual carbon goals. The national inertia market, as an innovative tool to deal with the problem of large-scale new energy in the power system, will play a key role in promoting the low-carbon transformation of China’s energy economy. This paper focuses the following questions: What is the inertia market? Why is it necessary to build a national inertia market? What kind of inertia market does China need to establish? How to build an inertia market with Chinese characteristics? A national inertia market is a difficult task that cannot be completed in a single day due to the complexity of the difficulties involved. The incomplete contractility and uncertainty of new energy sources make the demand for power system change more and faster than the traditional power system. For their prices to more properly reflect the value of resources to system reliability, inertial markets can have appropriate price formation processes that deliver more rapid and accurate price signals.

Keywords: Dual Carbon Goals; Energy Economy; National Inertia Market; Power System Reform (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-268-2_36

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DOI: 10.2991/978-94-6463-268-2_36

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