Further intensify efforts to build the electricity ancillary services market!-Qingdao Yilai Cable Co., Ltd.,

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Further intensify efforts to build the electricity ancillary services market!

Release date:

2023-02-28

As China’s new energy sector continues to grow rapidly on a large scale, the flexibility of power systems and the transformation of coal-fired power generation have become increasingly critical, making the development of ancillary services markets a topic of growing attention.

Zhao Xueshun, Deputy Director of the Market Supervision Department at the National Energy Administration, stated that large-scale development of new energy sources is the fundamental pathway for the low-carbon transformation of the power system, while the transformation and upgrading of coal-fired power plants serve as a crucial support for integrating these new energy resources into the grid. Among these efforts, what plays a pivotal role is Electricity Ancillary Services Market mechanism.

At the end of last year, China achieved full coverage of auxiliary power services across six major regions and the grids of 33 provinces and autonomous regions, and a unified system of auxiliary service rules has essentially taken shape.

In 2022, through the market-based mechanism for ancillary services, the nation unlocked system-wide regulation capacity exceeding 90 million kilowatts, annually enabling the generation of over 100 billion kilowatt-hours of clean energy. Meanwhile, coal-fired power companies earned approximately 32 billion yuan in compensation from providing these ancillary services, effectively boosting their enthusiasm to upgrade operational flexibility. This has accelerated the transition of coal power—from being a conventional mainstay source of electricity—to a dual role that equally emphasizes both basic reliability and system-level regulation capabilities.

Regarding the next steps in our work, the National Energy Administration will, guided by the principles of "demand-driven, transformation-oriented, and market-based," focus on advancing efforts in the following three key areas: First, further strengthen the development of the electricity ancillary services market; second, broaden the scope of ancillary service coverage even more; and third, deepen the exploration of the functional potential within ancillary services.