01 de junio de 2018
Resumen:
China's rapid economic growth - largely industrial, energy-intensive, and reliant on coal - has generated
environmental, public health, and governance challenges. While China now leads the world
in renewable energy deployment, curtailment (waste) of wind and solar is high and increasing,
generating much discussion on the relative contributions of technical inflexibilities and incomplete
institutional reforms on integration outcomes. These integration challenges directly affect China's
ability to meet long-term environmental and economic objectives. A second, related challenge
emerges from how wind integration interacts with China's reinvigoration in 2015 of a three-decadeold
process to establish competitive electricity markets. A «standard liberalization prescription»
for electricity markets exists internationally, though Chinese policy-makers ignore or underemphasize
many of its elements in current reforms, and some scholars question its general viability in
emerging economies. This dissertation examines these interrelated phenomena by analyzing the
contributions of diverse causes of wind curtailment, assessing whether current experiments will
lead to efficient and politically viable electricity markets, and offering prescriptions on when and
how to use markets to address renewable energy integration challenges.
To examine fundamentals of the technical system and the impacts of institutional incentives
on system outcomes, this dissertation develops a multi-method approach that iterates between
engineering models and qualitative case studies of the system operation decision-making process
(Chapter 2). These are necessary to capture, respectively, production functions inclusive of physical
constraints and costs, and incentive structures of formally specified as well as de facto institutions.
Interviews conducted over 2013-2016 with key stakeholders in four case provinces/regions with
significant wind development inform tracing of the processes of grid and market operations (Chapter
3). A mixed-integer unit commitment and economic dispatch optimization is formulated and, based
on the case studies, further tailored by adding several institutions of China's partially-liberalized
system (Chapter 4). The model generates a reference picture of three of the systems as well
as quantitative contributions of relevant institutions (Chapter 5). Insights from qualitative and
quantitative approaches are combined iteratively for more parsimonious findings (Chapter 6).
This dissertation disentangles the causes of curtailment, focusing on the directional and relative
contributions of institutions, technical issues, and potential interactive effects. Wind curtailment
is found to be closely tied to engineering constraints, such as must-run combined heat and power
(CHP) in northern winters. However, institutional causes - inflexibilities in both scheduling and
inter-provincial trading -have a larger impact on curtailment rates. Technical parameters that are
currently set administratively at the provincial level (e.g., coal generator minimum outputs) are a
third and important leading cause under certain conditions.
To assess the impact of China's broader reform of the electricity system on wind curtailment,
this dissertation examines in detail «marketizing» experiments. In principle, spot markets for
electricity naturally prioritize wind, with near zero marginal cost, thereby contributing to low
curtailment. However, China has not yet created a spot market and this dissertation finds that
its implementation of other electricity markets in practice operates far from ideal. Market designs
follow a similar pattern of relying on dual-track prices and out-of-market parameters, which, in the
case of electricity, leave several key institutional causes of inefficiency and curtailment untouched.
Compared to other sectors with successful marketization occurring when markets «grow out of
the plan,» all of the major electricity experiments examined show deficiencies in their ability to
transition to an efficient market and to cost-effectively integrate wind energy.
Although China's setting is institutionally very different, results support implementation of
many elements of standard electricity market prescriptions: prioritize regional (inter-provincial)
markets, eliminate conflicts of interest in dispatch, and create a consistent central policy on «transition
costs» of reducing central planning. Important for China, though overlooked in standard
prescriptions: markets are enhanced by clarifying the connection between dispatch and exchange
settlement. As is well established, power system efficiency is expected to achieve greatest gains
with a short-term merit order dispatch and primarily financial market instruments, though some
workable near-term deviations for the Chinese context are proposed. Ambiguous property rights
related to generation plans have helped accelerate reforms, but also delay more effective markets
from evolving. China shares similarities with the large class of emerging economies undergoing electricity
market restructuring, for which this suggests research efforts should disaggregate planning
from scheduling institutions, analyze the range of legacy sub-national trade barriers, and prioritize
finding «second-best» liberalization options fit to country context in the form and order of
institutional reforms.
Cita:
M. R. Davidson (2018), Creating markets for winde electricity in China: case studies in energy policy and regulation. Cambridge (Estados Unidos de América).