Core Viewpoint - The construction of the domestic electricity spot market in China is expected to significantly accelerate by 2025, driven by policy initiatives and market demand [1][10]. Group 1: Market Development - As of September 2024, Jiangsu officially launched the continuous settlement trial operation of its electricity spot market, marking a significant step in the development of electricity trading in the region [2]. - By the end of 2025, it is anticipated that the electricity spot market will achieve near-complete coverage across all provinces, with seven provinces already transitioning to formal operations [2][10]. - The electricity market in China is categorized into three main types: electricity spot market, medium- and long-term trading market, and auxiliary service market, each serving different trading timeframes and purposes [10][11]. Group 2: Market Dynamics - The electricity trading market has expanded significantly, with a more diverse and complex range of business activities compared to 2021 [4]. - In 2024, Jiangsu's total electricity consumption reached 848.6 billion kilowatt-hours, ranking first in the State Grid operating area and second nationally, indicating a high demand for electricity [7]. - The average monthly electricity trading price in Jiangsu exceeded 0.412 yuan per kilowatt-hour in 2024, suggesting potential savings for users who switch from State Grid's proxy purchasing to market participation [7]. Group 3: Policy and Regulation - Recent policy adjustments in Jiangsu aim to regulate the retail electricity market, including profit-sharing agreements between electricity retailers and users [8]. - The establishment of a unified regulatory framework for the electricity market is ongoing, with a focus on creating a comprehensive set of rules to ensure transparency and fairness [14][15]. - Challenges remain in harmonizing market rules across provinces while allowing for regional adaptations based on local resources and industry structures [16][17].

Core Viewpoint - The article emphasizes the establishment of a national unified electricity market in China, highlighting the importance of regulatory frameworks and market mechanisms to support the integration of renewable energy and ensure stable electricity supply and pricing [2][3][4][5][6][7][8]. Group 1: Market Structure and Mechanisms - The national unified electricity market is in a critical phase of development, with mechanisms for cross-regional trading and provincial spot markets being established and operational [2]. - The guidelines issued by the National Development and Reform Commission and the National Energy Administration aim to enhance the efficiency and sustainability of the electricity market [2]. - The long-term and short-term trading mechanisms are being refined to better accommodate the characteristics of renewable energy, allowing for multi-year agreements and dynamic adjustments to trading limits [2][3]. Group 2: Spot Market and Pricing - The spot market is evolving to reflect supply and demand dynamics, with a focus on optimizing pricing mechanisms to encourage participation from various market players [3]. - The introduction of new entities such as virtual power plants and smart microgrids is encouraged to enhance competition in the spot market [3]. Group 3: Auxiliary Services Market - The auxiliary services market is being developed to support the increasing demand for system regulation due to high proportions of renewable energy [4]. - The integration of auxiliary services with the energy market is aimed at improving system flexibility and ensuring that renewable energy sources can meet their balancing responsibilities [4]. Group 4: Capacity Compensation Mechanism - A differentiated capacity compensation mechanism is proposed to address the reliability challenges posed by the growing share of renewable energy [5]. - The establishment of a reliable capacity assessment mechanism will allow for more accurate pricing of various energy sources based on their reliability and contribution [5]. Group 5: Retail Market Development - The retail electricity market is being enhanced to improve transparency and competition, with new mechanisms for price estimation and information dissemination being introduced [6][7]. - Efforts are being made to ensure effective price transmission from wholesale to retail markets, encouraging consumers to respond to market signals [7]. Group 6: Market Monitoring and Intervention - The article outlines the need for improved market monitoring and intervention mechanisms to maintain fair competition and efficient market operations [8]. - Specific measures are proposed for monitoring market power and establishing clear protocols for market intervention when necessary [8]. Group 7: Future Directions - The Beijing Electric Power Trading Center is set to implement the guidelines and continue enhancing the operational level of the national unified electricity market [9].

Core Viewpoint - The article discusses the issuance of the "Guidelines for the Construction of Continuous Operation Markets in Electricity Spot Trading Areas," which aims to enhance the development of the electricity spot market in China, promoting resource allocation, renewable energy consumption, and ensuring power supply security [2][3]. Group 1: Background and Purpose - The guidelines were created in response to significant advancements in the electricity spot market, with seven provinces officially operating spot markets and plans for others to follow by the end of the year [3]. - The guidelines aim to implement the directives from the 20th National Congress regarding energy system reform and the establishment of a unified national electricity market [3][4]. Group 2: Scope and Design Principles - The guidelines apply to provinces where the electricity spot market is officially running or in trial operation, with other regions encouraged to reference them [4]. - The design principles focus on market-driven approaches, local adaptability, and orderly coordination, addressing common issues faced in provincial electricity market construction [4]. Group 3: Main Content of the Guidelines - The guidelines consist of nine articles divided into two parts: - The first part focuses on integrated design for a competitive and efficient electricity market mechanism, including optimizing spot trading mechanisms, improving medium- and long-term trading mechanisms, and establishing auxiliary service market systems [5]. - The second part outlines operational requirements for the electricity market, emphasizing market intervention mechanisms, operational capacity enhancement, regulatory oversight, and organizational support [6]. Group 4: Institutional Design - The guidelines propose three main institutional designs: - Integrated design of various trading products to reflect the true value of electricity and ensure cost recovery [8]. - Encouragement of competition among different market participants, adhering to a "technology-neutral" principle [8]. - Establishment of market monitoring and control mechanisms to promote orderly competition and realistic pricing [9]. Group 5: Implementation Steps - The National Development and Reform Commission and the National Energy Administration will promote the guidelines, guiding relevant departments and regulatory bodies in continuous market development [10]. - They will also monitor the construction of electricity markets in regions with continuous operation and revise the guidelines as necessary to adapt to new conditions and requirements [10].

Core Viewpoint - The issuance of the "Basic Rules for Electricity Market Measurement and Settlement" by the National Development and Reform Commission and the National Energy Administration marks a significant milestone in the reform of China's electricity market, establishing a foundational rule system for a unified national electricity market [1][2][3]. Group 1: Rule System Development - A unified electricity market rule system is essential for implementing major decisions from the central government and for building an efficient, fair, and open national market [1][2]. - The new foundational rule system, referred to as "1+6", includes the "Basic Rules for Electricity Market Operation" and covers various market segments such as medium- and long-term trading, spot trading, and ancillary services [1][3]. - The establishment of this rule system addresses issues such as fragmented market rules, inter-provincial barriers, and the need for effective protection of market participants' interests [1][3]. Group 2: Historical Context and Progress - The electricity market reform has evolved through pilot programs since 2016, leading to the gradual establishment of various market types across the country [1][2]. - The "Basic Rules for Medium- and Long-Term Trading" and the "Basic Rules for Spot Market (Trial)" were previously established to support the healthy development of the electricity market [2][3]. - The recent issuance of the "Basic Rules for Electricity Market Measurement and Settlement" fills the last gap in the "1+6" foundational rule system, ensuring comprehensive regulation of market operations [3][4]. Group 3: Market Functionality and Future Directions - The "Basic Rules for Electricity Market Operation" define participant roles, responsibilities, pricing mechanisms, and risk prevention strategies, serving as the core engine for market stability [4]. - The rules for registration, information disclosure, and measurement settlement function as the market's "identity card," "account book," and "calculator," ensuring fairness and transparency [4]. - The National Energy Administration plans to continuously improve the "1+N" foundational rule system to enhance coordination among various market types, including green electricity trading and ancillary services [4].

Core Viewpoint - The article emphasizes the transition of China's electricity market from a "single energy market" to a diversified market that includes "energy + capacity + ancillary services," driven by recent policy developments and market reforms [1][5]. Policy Developments - On April 29, 2025, the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA) jointly released the "Basic Rules for the Electricity Ancillary Services Market," aiming to enhance the operational mechanisms of the ancillary services market and clarify the construction timeline for the electricity spot market [2][4]. - The NDRC and NEA outlined a roadmap for establishing a unified national electricity market system by early 2025, with a goal of basic completion by 2030 [3]. Market Structure and Transition - The electricity market is evolving towards a model that integrates energy, capacity, and ancillary services, with significant progress in the mid-to-long-term market and ongoing development of the electricity spot market [5][6]. - The ancillary services market is being refined to support the stable operation of the electricity spot market, with rules being established to facilitate their integration [4][6]. Investment Opportunities - The ongoing market reforms are expected to benefit various new entities, such as innovative energy storage solutions and virtual power plants, as well as sectors like electricity IT and inter-provincial transmission infrastructure [1][8]. - The potential revenue sources for energy storage projects are expanding, with expected increases in income from energy markets, ancillary services, and capacity markets as reforms progress [7]. Market Construction Timeline - The construction of the electricity spot market is accelerating, with plans for continuous operation in five regions by 2024, including Inner Mongolia, Shandong, Gansu, Shanxi, and Guangdong [7][9]. - The timeline for the transition to formal operation of the electricity spot market in various provinces has been outlined, with specific deadlines set for regions like Hubei and Zhejiang [3][9]. Conclusion - The article highlights the significant changes in China's electricity market structure and the implications for various stakeholders, indicating a clear trend towards a more integrated and market-driven approach to electricity trading and services [1][5][8].