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Energy Storage Insights: Tracking Industry Hotspots!

Release time:

2025-10-13

Source:

On September 30, the National Development and Reform Commission and the National Energy Administration jointly issued a notice announcing the release of the "Measures for the Management of Energy Planning." A responsible official from the National Energy Administration answered questions from reporters, while the Electric Power Planning & Engineering Institute provided an interpretation. The National Comprehensive Energy Plan, national energy plans covering specific sectors, and regional energy plans are all systematically formulated and compiled under the coordination of the National Development and Reform Commission and the National Energy Administration. These planning catalogs must adhere to the principle of streamlining, ensuring they avoid issues such as excessive quantity or overlapping content. In principle, no plans outside the approved catalog list may be developed. Additionally, plans related to routine tasks or those with implementation periods shorter than three years are generally not required to be formally planned.

National Policies and Headlines

01 The National Development and Reform Commission and the National Energy Administration have issued the "Measures for the Administration of Energy Planning."

On September 30, the National Development and Reform Commission and the National Energy Administration jointly issued a notice announcing the release of the "Measures for the Administration of Energy Planning." Officials from the National Energy Administration answered questions from reporters, while the Electric Power Planning & Engineering Institute provided an interpretation.

The National Development and Reform Commission and the National Energy Administration jointly formulate and compile the catalog of national comprehensive energy plans, national sector-specific energy plans, and regional energy plans. The catalog must adhere to the principle of streamlining, avoiding issues such as excessive quantity or overlapping content. In principle, no plans should be developed that are not included in the catalog. Additionally, plans related to routine tasks or those with implementation periods shorter than three years are generally not required to be prepared.

The National Comprehensive Energy Plan is a comprehensive, guiding document that outlines the overall direction for energy development across the country, such as the "13th Five-Year Plan for Energy Development" and the "14th Five-Year Plan for Building a Modern Energy System." Nationally, sector-specific energy plans cover areas like electricity, coal, oil and natural gas, renewable energy, and energy technology innovation. Regional energy plans, meanwhile, primarily focus on implementing the nation’s strategies for regional coordinated development and major regional initiatives. In recent years, the state has formulated regional energy plans for areas such as the Yellow River Basin, the Yangtze River Delta, and the Guangdong-Hong Kong-Macao Greater Bay Area.

Projects strictly required to be included in energy plans—those falling under the approval or ratification authority of the State Council and relevant departments—cannot be independently incorporated into provincial energy plans until the national comprehensive energy plan and the nationwide sector-specific energy plans are clearly defined. For instance, before the national energy plan specifies cross-provincial energy transmission corridors, the energy authorities at both the sending and receiving provinces must refrain from "signing agreements" or including these projects in their respective provincial energy plans.

02 The National Development and Reform Commission is seeking comments on the "Standards for Identifying Major Accident Hazards in Power Systems and Regulations on Supervision and Management for Remediation (Draft for Public Comment)."

On September 29, the National Development and Reform Commission issued an announcement seeking public comments on the "Standards for Identifying Major Hazards in Power Systems and Regulations on Their Management and Supervision (Draft for Public Comment)."

The explanatory notes mention that Chapter 2, on criteria for identifying major hazards, now includes newly added clauses: one for determining flood risks in factory buildings, another for assessing quality management in power construction projects, a third addressing the zoning requirements for office and living areas in power construction and maintenance (including technical upgrades) projects, and a fourth focusing on ensuring compliance of specially trained personnel when they begin work.

The regulations clearly define any of the following situations occurring in the power grid or electrical equipment facilities as a major hazard:

(5) Wind farms, photovoltaic power plants, and electrochemical energy storage stations connected to grids at 220 kV and higher voltage levels lack the low-voltage ride-through capability, high-voltage ride-through capability, voltage control capability, dynamic reactive power support capability, and frequency operation adaptability as specified by national standards; or they have failed to put their active power control systems and reactive voltage control systems into operation as required by the power dispatching authorities; or they have not completed grid-connection tests in accordance with national standards.

Local Policies and Headlines

01 The Henan Provincial Development and Reform Commission has issued an announcement seeking public input on the "Implementation Plan for Deepening Market-Oriented Reform of New Energy Grid Parity Prices in Henan Province (Draft for Comments)." (October 11)

Existing Projects

Mechanism Electricity: For poverty-alleviation photovoltaic projects and low-voltage distributed PV projects connected to the grid at 380V or below, the mechanism electricity ratio is 100%, with all power fed into the grid counted as mechanism electricity.

Wind power, centralized photovoltaic systems, and distributed PV projects connected to the grid at 10 kV or higher: The share of mechanism-generated electricity is 80%, and the mechanism electricity capacity for each project is calculated as follows: Project grid-connected capacity × Annual utilization hours × (1 – Plant self-consumption rate) × Project mechanism electricity proportion.

Mechanism-based electricity pricing: Implemented according to Henan Province's current benchmark coal-fired power generation price (0.3779 yuan/kWh).

Implementation period: Determined by either the remaining full lifecycle hours of rational utilization, converted into corresponding years, or the earlier of 20 years from the project's commercial operation date.

Incremental Project

Mechanism Electricity Volume: The Provincial Development and Reform Commission will comprehensively consider factors such as the fulfillment of annual non-hydro renewable energy power consumption targets assigned by the state, as well as users' economic affordability, to determine the total scale of electricity allocated through the bidding mechanism. If the actual consumption exceeds the assigned target, the total mechanism electricity volume for the following year may be appropriately reduced; conversely, if the target is not met, the total mechanism electricity volume for the next year can be moderately increased.

The electricity volume for each individual project is allocated according to the principle of "monthly control ratio, annual control scale," and price difference settlement is carried out accordingly.

Mechanism-based electricity pricing: The declared price ceiling will be determined by considering factors such as reasonable costs and revenues, green value, the supply-demand dynamics of electricity, and users' affordability—though in principle, it will not exceed Henan Province's current benchmark coal-fired power generation price. Initially, to prevent disorderly competition, an auction floor price could be set based on the per-kilowatt-hour cost calculated from advanced power plant construction costs; this floor may later be removed depending on market conditions.

Implementation Period: Determined based on the average timeframe required to recover the initial investment for similar projects (excluding any associated benefits). For projects already in operation at the time of selection, implementation will commence on January 1st of the year following the announcement of bidding results. For projects not yet operational upon selection, implementation will begin on the 1st day of the month immediately following the declared commitment to start production.

The document also notes that new energy projects within integrated source-grid-load-storage initiatives, green power direct connections, and incremental distribution networks—projects designed to facilitate local consumption of renewable energy—as well as general commercial and industrial distributed photovoltaic systems and large-scale commercial and industrial distributed PV projects commissioned on or after June 1, 2025, will not be included in the scope of mechanism-based electricity pricing.

02 The Jiangsu Energy Regulatory Office has released the "Implementation Details for Grid Connection and Operation Management of Jiangsu Electricity" and the "Implementation Details for Auxiliary Service Management of Jiangsu Electricity."

On September 29, the Jiangsu Energy Regulatory Office released the "Two Detailed Rules" (Draft for Comments). These rules clearly state that energy storage power stations should have the capability to detect islanding conditions and automatically disconnect from the grid, as well as features such as AVC automatic voltage regulation and reactive power control. Notably, this time the two detailed rules explicitly classify primary frequency modulation provided by wind and photovoltaic energy storage systems as a basic ancillary service in the electricity market—meaning no compensation is required for this service. Meanwhile, other services like reserve capacity, paid reactive power regulation, rotational inertia, ramp-up capabilities, and black-start functions will be eligible for either fixed compensation or market-based compensation mechanisms.

The "Implementation Rules for Grid Connection and Operation Management of Jiangsu Electric Power" specify that independently operated, newly established energy storage power stations included in transmission and distribution price management will temporarily be exempt from operation management assessments.

Energy storage stations should have the capability to quickly detect islanding conditions and immediately disconnect from the grid. The response time for anti-islanding protection must not exceed 2 seconds. Failure to comply with this requirement will result in a monthly penalty of RMB 10,000.

Energy storage power stations should be equipped with Automatic Voltage Control (AVC) functionality. If a station lacks AVC capability, it will be subject to an assessment of RMB 10,000 per 10,000 kW per month based on its rated capacity. Additionally, the AVC operational availability must reach at least 98%; for every 1% below this target, a daily penalty of RMB 12 per 10,000 kW will apply, with the total monthly assessment capped at RMB 15,000 per 10,000 kW. Meanwhile, the AVC regulation compliance rate must achieve 100%; for each 1% shortfall, a daily penalty of RMB 12 per 10,000 kW will be imposed, with the monthly assessment ceiling set at RMB 10,000 per 10,000 kW.

If the reactive power regulation capability of the energy storage station fails to meet the requirements, resulting in daily voltage fluctuations exceeding 4% at the assessment point, a penalty of 8,000 yuan will be imposed each time this occurs.

Energy storage power stations must follow the quarterly bus voltage curves issued by the dispatching agency and comply with the assessment of bus voltage compliance rates. The voltage compliance rate is determined online by the power dispatching agency's EMS system; if the monthly voltage compliance rate falls below 98.5%, a penalty of 15,000 yuan will be assessed each month.

The startup condition for the real-time monitoring and evaluation system of primary frequency regulation is: when the grid frequency deviation exceeds the primary frequency regulation deadband (set at ±0.10 Hz for wind farms and ±0.06 Hz for photovoltaic plants) and persists for more than 30 seconds.

The "Implementation Details for Jiangsu's Electricity Ancillary Services Management" clearly defines the categories of electricity ancillary services as active power balancing services, reactive power balancing services, and emergency response and restoration services during accidents. Among these, active power balancing services include frequency regulation, peak shaving, reserve capacity, rotational inertia, and ramp-up services. Reactive power balancing services refer to voltage control services.

Among these, basic ancillary services for power generation are obligations of grid-connected entities and do not require compensation. They include primary frequency regulation, basic peak-shaving, basic reactive power adjustment, stable generator tripping, and stable load shedding, among others.

Paid ancillary services for electricity include AGC, paid peak-shaving (excluding peak-shaving in the energy market), reserve capacity, paid reactive power regulation, inertia, ramp-up services, black start, and more—these services can be provided either through fixed compensation or market-based mechanisms.

The compensation standard for rotational inertia is determined based on the maintenance costs of the equipment providing rotational inertia to the grid-connected system.

When the system load changes significantly, the compensation standard for ramp-up auxiliary services provided by grid-connected entities—covering the additional costs incurred—is reasonably determined. The compensation standard for these ramp-up services is set at 1,000 yuan per megawatt.

Paid reactive power compensation shall be determined based on the principle of covering costs lower than those for constructing new reactive power compensation equipment and its operation & maintenance expenses, specifically reflecting the additional costs incurred by providing paid reactive power services. For photovoltaic, wind power, and energy storage systems that follow dispatch instructions and deliver paid reactive power services during phase-modulation operations, the compensation standard will be set at 15 yuan per megawatt-hour.

The generating units designated to provide black-start services as outlined in the accident contingency plan will be compensated at a rate of 60,000 yuan per month for pumped-storage power plants, and 80,000 yuan per month for other power plants.

For power ancillary services already subject to market-based trading, clearing and settlement will be conducted according to the market trading rules; the fixed compensation provisions outlined in these detailed rules will no longer apply. For power ancillary services that have not yet entered market-based trading, monthly clearing and settlement of ancillary service compensation will continue as usual. Additionally, compensation costs generated from the start-up/shut-down and peak-shaving ancillary service market will be allocated and settled in accordance with these detailed rules.

Grid-connected entities that participate in the allocation of compensation costs for ancillary services but do not provide peak-shaving or frequency-regulation services shall bear the corresponding ancillary service compensation costs based on twice their average operating capacity.

The document also suggests that, once conditions are ripe, load-side grid-connected entities such as traditional high-energy-consuming industrial loads, commercially and industrially interruptible loads, electric vehicle charging networks, and virtual power plants can be implemented by reference.

These detailed rules shall come into effect from the date of issuance and will remain valid for five years.

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Energy Storage Insights: Tracking Industry Hotspots!

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Energy Storage Insights: Tracking Industry Hotspots!