China's first transmission right transaction has been implemented, marking the end of the "planned era" for power transmission channels. The unified toll collection is no longer applied, which represents a further step forward in the development of a unified national power market.
China has completed its first market - based power transmission right transaction, filling the gap in the power market system.
Yujian Energy noticed that on June 21st, the headline of the "World Economy" program on CCTV Financial Channel launched a series of reports on "Focusing on the Market - oriented Reform of Power Transmission Rights", highlighting the official power transmission of China's first power transmission right transaction.
Three days ago, on June 18th, at a press conference held by the State Council Information Office, the National Development and Reform Commission announced that the State Grid and China Southern Power Grid had reached China's first power transmission right transaction, and the market - based transaction of the Yunxiao DC power transmission right connecting Fujian and Guangdong was implemented. 113 market entities bid for more than 100 million kilowatt - hours of electricity, and finally 21 million kilowatt - hours were cleared, with the channel operating at full capacity.
This is the first time in China that the "right of use" of a power transmission channel has been put on the bidding platform. Previously, the use of cross - provincial and cross - regional power transmission channels was basically allocated through planning and a fixed transmission fee. The channels were scarce, but the value of this scarcity was never priced by the market. The significance of the Yunxiao DC pilot lies not in the transaction volume of electricity, but in answering a question: How much is a power transmission channel really worth?
01
The power transmission right easily breaks free from the shackles of "planning"
The protagonist of this power transmission right news, the Yunxiao DC, is not a new channel.
Located in Yunxiao County, Fujian Province, it is a high - voltage DC power transmission channel of the Fujian - Guangdong interconnection project. With a total investment of 3.2 billion yuan and a rated capacity of 2 million kilowatts, it was put into operation in September 2022. It is the only direct connection artery between Fujian (State Grid area) and Guangdong (China Southern Power Grid area).
Previously, the Yunxiao DC adopted a single capacity - based electricity price mechanism, with an annual fixed capacity electricity fee of 230 million yuan, shared equally by Fujian and Guangdong and included in the power transmission and distribution price for settlement. Market entities from other provinces that wanted to use the channel had to pay a unified fixed transmission fee of 0.0256 yuan per kilowatt - hour.
This logic made sense in the early stage of the channel's construction - first build the road, then discuss how to use it.
However, as the national unified power market gradually took shape, problems emerged. Liu Zehong, the resident vice - chairman of the Global Energy Interconnection Development and Cooperation Organization, believes that in the past, the focus was on "whether there was a road", and now more attention should be paid to "how to use the road and who can use it more efficiently".
The "fixed - price" fixed rate is the same during peak and off - peak hours, the same for clean electricity and thermal power, and the same for urgent and non - urgent entities. This is very unfavorable for improving the utilization efficiency of power transmission channels.
For example, in June this year, the southern region entered the peak summer power consumption period ahead of schedule. Guangdong's power consumption load hit a record high three times, becoming the first province in the country with a load exceeding 170 million kilowatts. The value of the channel increases sharply during peak periods, but the fixed rate used all along fails to capture this change.
The deeper problem lies in the system design. For a long time, the objects of inter - provincial spot, green power, and auxiliary service transactions in China have been the electric energy itself. The power transmission capacity has mainly been allocated through planning means and dispatching instructions, and the revenue has mainly come from fixed transmission fees.
The electric energy can be traded through bidding in the market, but the channels for transporting electric energy operate on the planned track. The right of use and the usage fee of the power transmission channel have never been separated. When the channel capacity becomes a scarce resource, it is difficult to effectively answer who should use it, how to use it, and at what price under the planned - led system.
The National Development and Reform Commission also directly stated at the press conference that as the national unified power market becomes more perfect and the scale of cross - provincial and cross - regional power transactions continues to increase, power transmission rights are increasingly becoming a scarce resource. Allocating scarce resources at a fixed price will inevitably lead to efficiency losses.
02
Bid first, then clear
A channel has two prices
According to the "Interim Plan for the Market - oriented Transaction of Yunxiao DC Power Transmission Rights" issued by the National Development and Reform Commission and the National Energy Administration: The power transmission right transaction is carried out in two steps. First, pre - clear the electric energy transaction, then allocate the channel according to the power transmission right bids from high to low, and finally the winning bid price is the marginal clearing price. The lower limit of the bid is 25.6 yuan per megawatt - hour, and the upper limit is 100 yuan per megawatt - hour. The two provinces of Guangdong and Fujian have the priority to use the channel capacity, and the remaining capacity is publicly auctioned through monthly, intra - monthly, and spot transactions.
In this case, the channel allocation has changed from "first - come, first - served" to "the highest bidder wins". Li Zhu, the deputy general manager of the Beijing Power Exchange Center, previously explained: "Previously, the use of power transmission channels was at a unified fixed price, and the value of scarcity was not reflected; the market - oriented transaction of power transmission rights determines the price in a market - based way and fairly decides the order of channel use according to the bids."
The result of the first transaction is very telling. According to the official statement, 113 entities bid for more than 100 million kilowatt - hours of electricity, far exceeding the surplus capacity of the channel. The proportion of time periods when the bid price for power transmission rights reached the upper limit of 100 yuan per megawatt - hour was 12%. Power users who bid higher for power transmission rights purchased more green power. Among the 21 million kilowatt - hours of cleared electricity, green power accounted for 16 million kilowatt - hours, accounting for more than 76%. The channel utilization rate was 100%.
The bidding mechanism has handed over the channel allocation from administrative instructions to price signals. Users who are willing to pay a higher premium for green power have obtained the channel with a higher bid for power transmission rights.
Wang Yi, a senior manager of the power market management in the marketing department of China Southern Power Grid Company, evaluated this transaction as groundbreaking in an interview with CCTV: "Truly hand over the 'right of use' of the channel to the market. Those who need it most and bid the highest can use the channel first."
According to regulations, the power transmission right fees will ultimately offset the capacity electricity fees for the Yunxiao DC paid by Fujian and Guangdong provinces. The premium generated from the bidding does not go into the pockets of any enterprises, but directly reduces the power transmission costs of users in the two provinces.
After calculation, it is estimated that it will help enterprises save at least about 50 million yuan in electricity fees every year. After the scarce value of the channel is discovered by the market, it is returned to the users. This closed - loop design makes the power transmission right transaction not only a resource allocation tool but also a cost - sharing mechanism.
03
The scarce value of the channel
Effectively fills the system gap
The greatest significance of this transaction lies not in the 21 million kilowatt - hours of electricity, but in filling a system gap.
This is China's first pilot project for market - oriented power transmission right transactions. For the first time, the capacity of the power transmission channel has been traded as an independent commodity in the market, filling the system gap in the field of power transmission capacity allocation in the national unified power market.
Yujian Energy learned that before this, the national unified power market already had an electric energy market, an auxiliary service market, and a green power market, but there had been no market - based solutions for how to allocate and price the power transmission capacity.
The implementation of the Yunxiao DC pilot means that the trading varieties in the power market have extended from "electricity" to "roads".
The National Development and Reform Commission has also clearly defined three goals for the market - oriented transaction of power transmission rights: to fairly and efficiently allocate channel resources, to reasonably share power transmission fees, and to promote the optimal allocation of power resources on a larger scale.
The first two goals have been initially verified in this transaction. The third is the real test - the market - based channel price can objectively reflect the supply - demand differences in different regions and power transmission channels.
The further analogy from the National Development and Reform Commission is that just like a navigation map that reflects the real - time traffic flow on the road, the higher the price, the more tense the channel resources are, which can guide market entities to actively optimize their channel choices. When the price of the power transmission right of a channel is transparent enough, there will be a market basis for the economic evaluation of new channels. The channel is no longer just an engineering problem but also an economic problem.
The Yunxiao DC is just the beginning. Relying on this channel, the State Grid and China Southern Power Grid have completed pilot projects for all types of transactions, including medium - and long - term, spot, and power transmission rights, across the power grid operating areas. There are currently only two power transmission channels between the two major power grids, and the other one is the Jiangcheng DC from the Three Gorges to Guangdong.
Last year, three inter - grid power flexible mutual - assistance projects in Chongqing - Guizhou, Hunan - Guizhou, and Hunan - Guangdong were approved by the state, with a total investment of more than 15.6 billion yuan expected. They will be completed and put into operation before the peak summer power consumption period in 2027. By then, the number of channels between the two major power grids will increase to five.
The more channels there are, the wider the application scenarios for power transmission right transactions will be.
In summary, the market - oriented transaction of power transmission rights is still in the exploratory stage. After the monthly transactions, how the quarterly transactions will be carried out, whether the upper and lower limits of the bids will be adjusted, and when other cross - regional channels will follow up, these questions still have no answers.
Yujian Energy will continue to follow up and report on this.
Attached herewith is the Interim Plan for the Market - oriented Transaction of Yunxiao DC Power Transmission Rights from the official website of the National Development and Reform Commission:
This article is from the WeChat official account "Yujian Energy", author: Wang Mengjiao. It is published by 36Kr with authorization.