The impacts of market reform on the market penetration of natural gas-fired electricity and renewable energy in China

Natural gas-fired electricity(NGFE) is expected to play a more important role in the future due to its characteristics of low pollution, high efficiency and flexibility. However, its development in China is impeded by its high regulation price compared with coal power. Market reform is therefore of vital importance to promote the penetration of NGFE. The objective of this study is to analyze the impacts of market reform and the renewable electricity(RE) subsidy policy on the promotion of NGFE and RE. A dynamic game-theoretic model is developed to analyze the interaction among the NG supplier, the power sector and the power grid. Three scenarios are proposed with different policies, including a fixed regulation price of NG and electricity, real-time pricing(RTP) of NG and electricity, and subsidy targeted at RE. The results show that:(1) market reform can sharply decrease the NG price and consequently promote the development of NGFE and RE;(2) subsidy targeted at RE not only promotes the penetration of NGFE and RE, but also increases the utilization ratio of renewables significantly;(3) market reform and the subsidy also enhance consumers’ welfare by reducing their power consumption expenditure.

Study of the impacts of upstream natural gas market reform in China on infrastructure deployment and social welfare using an SVM-based rolling horizon stochastic game analysis

Natural gas is expected to play a much more important role in China in future decades, and market reform is crucial for its rapid market penetration. At present, the main gas fields, pipelines and liquefied natural gas(LNG) infrastructure are mainly monopolized by large state-owned companies, and one of the important market reform policies is to open up LNG import rights to smaller private companies and traders. Therefore, in the present study, a game theoretical model is proposed to analyze and compare the impacts of different market structures on infrastructure deployment and social welfare. Moreover, a support vector machine-based rolling horizon stochastic method is adopted in the model to simulate real LNG price fluctuations. Four market reform scenarios are proposed considering different policies such as business separation, third-party access(TPA) and their combinations. The results indicate that, with third-party access(TPA)entrance into the LNG market, the construction of LNG infrastructure will be promoted and more gas will be provided at lower prices, and thus the total social welfare will be improved greatly.

Review on the petroleum market in China:history,challenges and prospects

The petroleum industry plays an essential role in driving China's economic development.In the past few decades,severa reforms in the petroleum industry have been implemented;however,there are still some is sues that have not been resolved Moreover,with the new-normal economy,the transition to green energy and international trade disputes,the petroleum marke is also facing emerging challenges.Therefore,the purpose of the present study is to review the historical development o China's petroleum market,identify the current challenges and propose corresponding countermeasures for future prospects As a conclusion,five main challenges are highlighted totally,namely lack of marketization,excess oil refining capacity,hig external dependency,environment pollution and unstable international trading relationship.To address these challenges it is encouraged to deepen petroleum market reform,accelerate the elimination of inefficient refining capacity,diversify of supply sources,as well as improve domestic petroleum enterprises'ability to resist price risks.

Medical Reform Should Follow Market Rules——Exclusive interview with Professor Hai Wen,Vice President of Peking University

Hai Wen, economist and vice president of Peking University, has for many years been involved in in-depth investigation and research of China's medical reform, earning a reputation as one of the foremost economists in the field of medical reform. However, in the recent debate on medical reform policy, Hai Wen deliberately decided to keep a low profile. In his view, some of the ideas coming out of academic circles these days are "too short-sighted and political-motivated." During this interview, he talks about this recent round of medical reform debate, its challenges, and prospects for future reform.

An economic analysis of China’s domestic crude oil supply policies

China's domestic oil production has lagged the growth in domestic oil consumption since the beginning of the 21st century,leading to a growing reliance on imports.In response,the Chinese government has introduced a number of policies,including import license constraints,to support domestic suppliers.In an effort to measure the economic impact of these policies we develop a short-run equilibrium model of China's wholesale oil and gas market at the provincial scale.We construct counterfactual scenarios that suggest that relaxing policies that prioritize domestic production in 2016,when the average price of Chinese oil imports was US$42 per barrel(bbl),could have increased China's import demand by 0.29 million barrels per day(MMbbl/d).This results in a substitution of 9%of China’s domestic production in 2016,and a reduction of US$2.8 billion in crude supply costs including transportation as the imported oil has more direct access to the country’s pipeline network,compared to the displaced domestic production.In addition,rising import prices since mid-2017 may provide a window of opportunity for Chinese policymakers to proceed with further deregulation of the domestic oil sector,as the short-term impact on domestic producers is reduced.

Can the Shanghai LNG Price Index indicate Chinese market?An econometric investigation using price discovery theory

China became the world's second largest liquefied natural gas(LNG)importer in 2018 but has faced extremely high import costs due to a lack of bargaining power.Assessments of the Shanghai LNG Price Index,first released in 2015,are vital for improving the understanding of these cost dynamics.This paper,using the LNG price index data from the Shanghai Petroleum and Gas Exchange(SHPGX)coupled with domestic and international LNG prices from July 1,2015 to December 31,2018,estimates several econometric models to evaluate the long-term and short-term equilibriums of the Shanghai LNG Price Index,the responses to market information shocks and the leading or lagging relationships with LNG and alternative energy prices from other agencies.The results show that the LNG price index of the SHPGX has already exhibited a long-term equilibrium and short-term adjustment mechanisms to reflect the average price level and market movements,but the market information transparency and price discovery efficiency of the index are still inadequate.China's LNG market is still relatively independent of other natural gas markets,and marketization reforms are under way in China.The influence of the SHPGX LNG price index on the trading decisions of market participants is expected to improve with further development of China's LNG reforms,the formation of a natural gas entry-exit system,and the increasing liquidity of the hub.

Promoting Private Entrepreneurship for Deepening Market Reform in China： A Resource Allocation Perspective

After more than three decades of rapid growth, China＇s economy is going through an important turning point, where structural imbalances in both supply and demand sides must be addressed for a more moderate and sustainable growth path. By focusing on the structural changes to its ownership, a central element in China＇s economic transformation under market reform, the present paper highlights the importance of private entrepreneurship in deepening market reform and, thereby, in driving economic growth in a more efficient and sustainable way. Based on a perspective of resource allocation and a conceptual framework of entrepreneurship, the paper elaborates on the evolution of the private sector and its performance in the context of ownership reform, making comparisons with the performance of the state sector. The analysis suggests that there is further room for more productive use of economic resources, especially capital, land and natural resources, by increasing the participation of private entrepreneurs in industries with high entry barriers in favor of state-owned enterprises. Moreover, more competitive and equal access to productive resources through reform is needed to promote more productive entrepreneurship and to reduce rent-seeking activities.

China's Pension Reform and Capital Market Development

The paper analyzes the interaction between the pension system and capital marketdevelopment, especially the case of China. A funded pension system is most likely to boostthe capital market, but in the absence of a supportive financial infrastructure and effectivefinancial regulation, a funded system will not be successful. Chinas determination to establisha partially funded system is a first step in the right direction, but without the separation ofindividual accounts from the social pooling and their replenishment, the working out of theimplicit pension debt, and improvements in pension fund management and regulation, thepension system will not be sustainable. The key to capital market development in the processof the pension reform is to enact laws to protect the interests of pensioners, to contract outpension fund management to professional asset managers, and to accelerate the financialopening.

Review of Middle East energy interconnection development

In recent years,the Middle East region countries have experienced rapid population and economy growth,which has resulted in large increase of energy and power demand.Although the traditional fossil fuels remain the majority for supplying the domestic demand,additional generating capacity and fuel supply are necessary according to current situation and future demand forecast.The renewable energy provides an alternative resource for satisfying demand,especially in this region with high potential of solar and wind energy.Besides the development of renewable energy,interconnected electricity networks also enable the cross-border power exchange to fulfil electricity demand.Many Middle East countries have already started developing renewable energy and reforming the national power sector for regional electricityintegration.However,none of them has already implemented their targets and the challenges are still huge.This study reviews current conditions of electricity and energy interconnection development,and analyzes the process of regional electricity network integration and national power sector reforms and provides suggestion for regions’plan.Finally,the technology developments for future power grid interconnection and renewable energy integration are also reviewed.