The University of Bath and the University of Cambridge in collaboration with HM Government organised the inaugural UK-China training course in power markets for a delegation of Chinese Officials from 23rd-26th September 2019 in the UK.
The course was designed to help Chinese officials to prepare for the deregulation of their electrical power industry and achieve the key aims of improving supply efficiency and lowering the cost of decarbonisation. The course presented key learnings from the UK’s 30-year experience in the deregulation of the UK energy sector and showcased different perspectives from government, the regulator, network companies and electricity market participants. The course provided much needed support and clarity as China contemplates the most appropriate path to deregulate its power industry, seeking to learn lessons from the UK’s experience of deregulation in the 1990s and to minimise unintended consequences.
The course was delivered by 14 UK leading experts from the Department of Business, Energy and Industrial Strategy (BEIS), Foreign & Commonwealth Office (FCO), Ofgem, National Grid, Npower, Centrica, Shell, Chiltern Power, PA Consulting, Poyry Management Consulting and the Universities of Bath and Cambridge. It included a visit to the Control Centre of National Grid, the UK system operator.
The experts had in depth discussions around spot market designs, provincial and national market coordination, the interactions between trading and physical systems, and information exchanges between key stakeholders to ensure effective competition.
The 20 Chinese delegates included representatives from the National Energy Administration, the State Grid of China, China Southern Power Grid and eight major generation companies. They represent the key forces to drive market reform in China, from national and local energy regulators, through energy trading centres and dispatch centres, to energy generation and energy retailing. They provided the UK experts with a deeper understanding of the challenges in reforming the power sector and, the unique political, economic and social constraints China is facing.
Professor Furong Li from the University of Bath and Professor Michael Pollitt from the University of Cambridge co-hosted the training course with the support of the British Embassy in Beijing and BEIS/FCO. This event had significant input from partner universities, including Tsinghua, Xi’an Jiaotong and North China Electric Power University.
Professor Li said: “China’s low carbon transition is both urgent and challenging, as coal still accounts for almost 60% of electricity generation in the country, and there is major geographical mismatch between supply and demand.
“Structural reform of the power sector is essential to ensure the cost of the low carbon transition is minimised for the 1.4 billion people who live in China. The UK is a recognised world leader in power markets with 30 years of experience and learning, so I am pleased that we are able to assemble a strong UK team to share the ideas, knowledge and experience from differing stages of market evolution.”
Professor Gary Hawley, the Dean of Faculty of Engineering and Design said: “The Faculty has a strong presence in China in the areas of energy and electro-mechanical systems, in collaboration with Zhejiang, Tsinghua and North China Electric Power Universities. We are pleased to work with BEIS/FCO, the British Embassy in Beijing and the wider UK industries to support China’s power sector reform.
“China has the world's largest electricity system, which produces 25% of the world’s electricity and more than 7% of the world’s greenhouse gas emissions. This work will have a direct impact on global carbon emissions, energy affordability and security.”
Professor Jeremy Bradshaw, Pro-Vice Chancellor (International and Doctoral) added: “I am delighted that this training course for Chinese officials has been such a great success. It provides yet another example of the strength of research at the University of Bath and its relevance to our 21st Century World.”
The event represents a major step up of the UK’s efforts in supporting China’s power sector reform, and significant extension of the University of Bath’s collaboration with leading Chinese academics, Chinese power industry and policy makers.
China’s continued long-term growth potential and, by association, its continued capacity to alleviate poverty, are now linked to its ability to transition towards a more sustainable low-carbon economic growth model. The energy and low carbon strand of the China programme will match China’s specific reform needs with UK energy and low carbon strengths, reducing global emissions by accelerating China’s energy transition.