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Will electricity prices drop with the full market entry of new energy power generation?

Zhitong
Feb 23, 2025 at 12:49 AM

With the in-depth implementation of the comprehensive market-oriented policy for renewable energy generation, a series of positive changes are quietly occurring. These policies not only bring unprecedented development opportunities to the renewable energy industry but also inject new vitality into the reform of the entire electricity market. According to interpretations from relevant officials, this reform does not affect the electricity price levels for residential and agricultural users, and these users will continue to follow the current catalog sales electricity price policy. For industrial and commercial users, static estimates show that the average electricity price for industrial and commercial users nationwide in the first year of the reform will remain basically unchanged compared to the previous year. In regions where electricity supply and demand are relaxed and renewable energy market prices are lower, the electricity prices for industrial and commercial users may even decrease slightly. In the future, electricity prices for industrial and commercial users will fluctuate with factors such as electricity supply and demand and the development of renewable energy. If the investment efficiency of incremental renewable energy projects improves, the costs paid by users are expected to decrease. Against the backdrop of fully implementing market-oriented pricing and price difference settlement mechanisms for renewable energy, renewable energy companies need to enhance their profitability and market competitiveness by improving power generation efficiency and reducing operating costs. Flexible resources such as energy storage, virtual power plants, and demand-side response are expected to welcome greater development space in a market-oriented environment, and their business models will become increasingly mature and refined

Source: Zhitong The copyright of this article belongs to the original author/organization.

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