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Ilka LEWINGTON, Deng PAN. Economic Regulation of Network Connection of Offshore Wind: Applying European Experience to China: Part Ⅱ[J]. SOUTHERN ENERGY CONSTRUCTION, 2018, 5(3): 8-18. DOI: 10.16516/j.gedi.issn2095-8676.2018.03.002
Citation: Ilka LEWINGTON, Deng PAN. Economic Regulation of Network Connection of Offshore Wind: Applying European Experience to China: Part Ⅱ[J]. SOUTHERN ENERGY CONSTRUCTION, 2018, 5(3): 8-18. DOI: 10.16516/j.gedi.issn2095-8676.2018.03.002
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Economic Regulation of Network Connection of Offshore Wind: Applying European Experience to China: Part Ⅱ

  • 1.

    DNV-GL Energy, Kurt-Schumacher Str. 8, Bonn 53113, Germany

  • 2.

    DNV-GL Energy, Bluiding 8, Hongqiao State Guest Hotel, Hongqiao Road 1591, Shanghai 200336, China

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  • Received Date: June 04, 2018
  • Revised Date: August 19, 2018
    Abstract
  •     [Introduction]   This paper is Part 2 of two papers, looking at applying European countries′ experience with economic regulation to one of the urgent challenges of China′s electricity systems: namely the effective connection of offshore wind.
        [Method]   Using a methodology of comparative analysis of regulatory regimes, five components of regulatory regimes for offshore wind are defined and assessed for China: regulatory entity, degree of effective unbundling, tariff regulatory method and connection charging method and responsible entity. The paper analyses the changes to China′s network regulatory regime under way through Document No. 9 and related regulatory changes, including the introduction of a separate mechanism of economic regulation for China′s network companies, vividly described as "take control of the middle, release the two sides" .
        [Result]   The paper finds that the new regulatory methods still need refinement in order to ensure that they fulfil regulatory objectives such as allocative and cost efficiency, as well as quality of service-including timely connection and full transmission of onshore and offshore wind power. Based on the experience of three European case studies (Part 1 of the two papers), representing the TSO model, the generator model and the third-party model in Part 1, the paper concludes that in principle, all three models could be applied in China. Bearing in mind some similarities and differences in assumptions and priorities between Europe and China, the paper recommends that China adopts the regulatory model best aligned with its priorities.
        [Conclusion]   If the most urgent priorities are to improve the co-ordinated development of generation and network capacities and to provide good incentives for transmission investments, the TSO model would be most suitable; however, it would be vital to implement this model through an independent regulator, with legally binding network planning and clear liabilities for the network companies′ failure to connect in time, and also incentives to reduce curtailments.
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