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Top Ten News on Distributed Energy Resources in 2017

In November, National Development and Reform Commission and the National Energy Administration released the Notice on Piloting Market-Oriented Distributed Generation”, which has clarified the single capacity, grid connecting conditions, trading ways and pilot plans of distributed power generating project. The document is the extension of Power System Reform No. 9 Document, and if the pilot results are good, the Electric Power Law will be revised to promote the distributed energy to the market completely, and the partition-wall electricity selling will be realized.

With the technological progress and cost reduction of the PV industry, for the distributed PV power generation project of “self-production for self-use and feeding excess electricity to power grid” mode adopted after January 1, 2018, the subsidy standard for whole current intensity is reduced by 0.05 Yuan, that’s, the subsidy standard is adjusted as 0.37 Yuan/ KWh (tax included). For the distributed PV power generation project of “full amount feed into power grid”, the price will be the one of the PV plant of the local resource area. The electricity prices of marker post of Category I, II and III resource areas are adjusted as 0.55 Yuan/ KWh, 0.65 Yuan/ KWh and 0.75 Yuan/ KWh (tax included) respectively.

With the continuous deepening of wind energy exploration and the improvement of low wind speed technology, speeding up the construction of distributed wind power project accessed to low-voltage distribution network and eliminated on the spot is of great significance to optimizing the use of the distributed wind energy resources in the mid-east and southern regions, improving the wind power utilization efficiency locally and promoting the integrated development of wind power and other distributed energy.

In March, according to the requirements of “Work Plan on Prevention and Control of Air Pollution in Beijing, Tianjin and Hebei and Its Surrounding Areas in 2017” issued by the Ministry of Environmental Protection, 28 cities including Beijing, Tianjin, and Shijiazhuang, Tangshang, Langfang, Baoding, Cangzhou, Hengshui, Xingtai and Handan in Hebei, and Taiyuan, Yangquan, Changzhi and Jincheng in Shanxi, and Jinan, Zibo, Jining, Dezhou, Liaocheng, Binzhou and Heze in Shandong, and Zhengzhou, Kaifeng, Anyang, Hebi, Xinxiang, Jiaozuo and Puyang in Henan implemented the Key Winter Clean Heating Project according to the principle of “adopting gas or electricity as appropriate”. Under the background, many distributed energy resource projects emerged. However, it turns out that the step is a little big in the reality.

Sichuan and Shaanxi have issued documents successively to state that no specific electricity price will be clarified via separate document for specific enterprises, the gas power generation enterprises are encouraged to negotiate with power consumers and power grid enterprises to determine the specific electricity price and supply & consumption price, and how to take what it needs to achieve win-win with users and power grid and break through the grid-connection difficulty will be the critical issue that natural gas distributed energy industry needs to consider. It should be noted that it will not be feasible at all if it does not cooperate with power grid for the project.

Microgrid refers to the small distributed power system (including energy storage device if necessary) composed of distributed power source, electrical load, distribution facilities and monitoring & protection equipment, etc. It is divided into grid-connected microgrid and independent microgrid which can realize self control and management. As a part of and the important supplement to the whole power grid system, microgrid can supply economic, safe and reliable power to the specific users. It is a new-generation power grid development mode promoting the coordination of centralization and decentralization and characterized by minisize, cleanliness, self control and friendliness.

In the Guidance on Strengthening the Management of Natural Gas Distributed Energy Project of Sichuan Province, the building-type unit shall not exceed 10mw, while regional unit shall not exceed 50mw and the total capacity shall not exceed 25% of the maximum load within the power supply area of the superior transformer. The Project Owner and Investor shall not participate in the construction of direct-supply power lines and power distribution network. Power grid enterprises shall be responsible for the external grid-connecting facilities of natural gas distributed energy project and the investment in the construction due to the access to the transformation part of public power grid.

Biomass energy has natural distributed energy performance. The “Guidance on Promoting the Development of Biomass Energy for Heating” issued by the two China’s ministries and commissions indicates that as an important measure for air pollution prevention & control and clean heating, biomass energy for heating has been included into the work arrangement and plan together with the governing of scattered coal, “coal-to-gas” and “coal-to-electricity” projects to encourage the legal person of biomass thermoelectricity project to set up an electricity sales company, be engaged in market-oriented electricity sales and provide cooling-heating power, contract energy management and other comprehensive energy services for the surrounding users. Besides, participating in the distributed generation market-oriented transaction and selling electricity to users within the distribution network are supported so as to construct the distributed clean heating system in cities and towns.

Shanghai released the fourth round of natural gas distributed energy subsidy, increased from 3,000 Yuan/ kw to 3,500 Yuan/ kw, and the subsidy amount for each project does not exceed 50 million Yuan. “Changsha City’s Measures to Promote the Development of Distributed Energy Sources of Natural Gas” indicates that subsidies are given at 2,000 Yuan/ kw according to the installed capacity, and the subsidy amount for single building-type natural gas distributed energy project shall not exceed 5 million Yuan at most, while that for single region-type project shall not exceed 15 million Yuan at most, which is reduced by 1000 Yuan compared to the subsidy of 3000 Yuan/ kw proposed in the Interim Measures released by Changsha City in February 2014. The maximum subsidy amount for single project is no longer 50 million Yuan, because the final subsidy depends on the government’s financial resources.

National Energy Administration has released 23 multi-energy complement & integrated optimization demonstration projects, 28 new-energy microgrid demonstration projects and 56 “Internet +” smart energy (energy internet) demonstration projects. Although varied in concepts, they are all essentially clean and efficient uses of energy, in which distributed energy plays a very important role. We will wait and see the specific effects of these projects.