Research On China's Coordinated Electricity Regulation Considering Environmental Restriction

Since 1980s, deregulation, reorganization, marketization have became the common choices of many countries in the world. Of course, these countries should rebuild regulatory system to ensure fair competition in electricity market, along with electricity marketization reform. Moreover, the regulatory measures should be based on the rules of market and competition. With people's rising consiousness on environmenatal protection and increasing deterioration of climate change, the meanings of electricity regulation become broader and environmental protection has become an important function of electricity regulation.Up to now, the regulation on China's electric power industry still follows the intersected administrative mode. As a result, NDRC, SERC, local economy (and trade) commissions and MoEP hold respectively part of the powers of electricity regulation. The dispersed regulatory framework is not for the aim of checks and balances, but is inherited from planned economy. Currently, the intersected regulatory framework and inconsistent regulatory measures not only go against the fair competition of power industry, but also obstruct the sustainable development of China's electric power industry. Recent years, with the shortage of power supply, China's generation structure becomes more unsound, accordingly the environmental pollution of electric power industry gets more serious. As a result, China's electricity regulation faces great challenge.Hence, how to bring environmetal protection into a uniform regulatory system, which can promote the sustainable development of power industry with environment, has become an important research topic of electricity regulation in many countries, including China. In order to solve the problem, the research team led by Professor Ren Yu-long in China put forward the idea of coordinated electricity regulation. Coordinated electricity regulation includes not only the regulation on electricity market, but also the environmental regulation on electric power industry. Moreover, the aim of coordinated electricity regulation is to achieve sustainable development of electric power industry with environment, by coordination between different regulatory institutions. In result, comparing with that of narrow-sense"electricity regulation"which refers only to regulation on electricity market, the meanings of coordinated electricity regulation are more extensive, accordingly the research field of coordinated electricity regulation is broader. Considering the limitation of the length, this dissertation pays its research emphases on several China's coordinated electricity regulation issues related with environmental problem, besides interpretation of the conception of coordinated electricity regulation. These issues can be concluded as two topics, 1) regulatory measure; 2) regulatory organization.In detail, the researches of this dissertation can be described as follows.In Chapter One, the research background and significance of this dissertation are introduced. Then, some important conceptions in this dissertation are interpreted. At last, the research path of this dissertation is put forward.In Chapter Two, as basic work, the developing trends of relevant theories, including theory of coordination, theory of government regulation, and theory of electricity regulation, are introduced.In Chapter Three, after analyzing the characteristics of electricity regulation and its evolvement in the world, the conception of coordinated electricity regulation is interpreted and its meanings are expounded, Afterward, a generic conceptual model of coordinated electricity regulation is put forward, using Soft Systems Methodology of Checkland and Coordination Theory of Malone and Crowston for reference.In Chapter Four, the reform course of China's electric power industry is recalled. Then, the evolvement of China's electricity regulation is reviewed and the shortages of current China's electricity regulation are analysed, from the point of view of coordinated electricity regulation. Afterward, an idea of China's coordinated electricity regulation is brought forward, after analyzing the environmental constraint which China's electric power industry faces.Whereafter, coordinated electricity regulatory measures are studied in Chapter Five and Chapter Six.In Chapter Five, basing on Multi-criteria Diversity Analysis, an optimization model of China's generation structure is designed. In this model, not only economic factor, but also other factors such as environmental influence, supply security, etc, are all involved. By this model, optimization of China's generation structure is studied and relevant measures to facilitate optimization of generation structure are put forward. In Chapter Six, environmental regulation on thermal plants is studied, basing on the rule of economic efficiency-environment harmony. First, the optimal tax rate is studied by External Theory. Second, an environmental regulatory mode basing on"emission performance of interior power demand + tradable emission permission"is put forward by Property Theory.In Chapter Seven, organization design of China's coordinated electricity regulation considering environmental constraint is studied, following research on game model of electricity regulation with multiple regulators and reference of foreign experiences on electricity regulation.The innovations of this dissertation can be described as follows.Firstly, this dissertation considers electricity regulation as a complex system project. It also clarifies the conception of coordinated electricity regulation, basing on the theory of coordination. Using Soft Systems Methodology of Checkland and Coordination Theory of Malone and Crowston for reference, the dissertation gives a conceptual model of coordinated electricity regulation. The model brings environment protection into the uniform electricity regulatory framework. This provides a new idea to study the problems of China's electricity regulation under environmental congstraint.Secondly, considering the development of"west electric power for east area"and"big area power market", an environmental regulatory mode basing on"emission performance of interior power demand + tradable emission permission"is put forward, basing on Coase's Property Theory. The author proves that the mode can not only ensure the economic rule but also achieve the fair rule of the regulatory measure. In other words, under this mode, the beneficiary pays entirely for the pollution. The mode can solve the potential fair problems in the process of"west electric power for east area".Thirdly, this dissertation studies the optimization of generation structure by Multi-criteria Diversity Analysis (MDA). An optimization model which can synthetically consider multiple factors of generation technologies, such as, economic efficiency, environment influence, and supply security, etc, is built, basing on MDA. Comparing with the optimization models which base on Mean-Variance Portfolio (MVP), the model of this dissertation can not only decompose the risk source of generation portfolio but also quantify the risk factors including environment influence. The model provides a new methodology to study coordinated electricity regulation considering environmental constraint.Fouthly, organization structure and relevant communication and coordination mechanism of China's coordinated electricity regulation under environmental constraint, are designed, basing on the research on game model of electricity regulation under multiple regulation and the reference of foreign electricity regulatory organization arrangement. This dissertation studies not only the mechanism of communication and self-coordination between regulatory institututions but also the third-part coordination on these regulatory institutions. Besides, considering the fact that state-owned enterprises (SOEs) dominate China's power industry, this dissertation suggests to bring the interior regulation of SASAC on SOEs into uniform electricity regulatory framework.