Electric reform led the reform of energy resources prices kicked off

On the Christmas Day of 2014, China’s energy industry received a big gift: “Several Opinions on Further Deepening the Reform of the Electric Power System” has been approved by the State Council’s executive meeting in principle and will be released after the approval, while the new power reform plan will be released from sale. The pricing of electricity and competition links to promote the reform of electricity marketization means that the "hard-boned reforms" are finally beginning to open in 2015.

Electric reform is undoubtedly a microcosm of the price reform ideas in 2015. In accordance with the government's reduction, release, and reform of government pricing, all market-determined prices are given to the market. The government does not engage in improper intervention and vigorously promotes price consolidation. Decentralization and improvement of the mechanism mainly determined by the market.

On October 29, 2014, Li Pumin, secretary-general of the National Development and Reform Commission, pointed out that “Accelerating price reforms will open up a number of commodity services and resource products prices regulated by the National Development and Reform Commission.” Executive of the State Council held on November 15, 2014 The meeting demanded that we should step up efforts to formulate price reform programs so as to achieve unified planning, mature one, and launch one. The “Energy Development Strategic Action Plan (2014-2020)” promulgated in November 2014 made it clear that price reforms in oil, natural gas, and electricity, etc. should be promoted, prices of competitive links should be liberalized in order, natural gas wellhead prices and sales prices, and access to the Internet. Electricity prices and sales tariffs are formed by the market. Transmission and distribution tariffs and prices for oil and gas pipelines are priced by the government.

A number of experts interviewed by the reporter of the "Economic Information Daily" believe that while the reform will lead the reform of energy and resource prices in 2015, natural gas price reform will continue to advance. According to the plan, in 2015, the prices of non-residential stock gas and incremental gas will be combined, non-residential gas prices will gradually be released, and household living gas will also establish a ladder price system. Since the State Council has repeatedly proposed to speed up the market-oriented reform, the process of natural gas price reform will be accelerated and it is expected to be completed in the first half of 2015.

The reform of the oil and natural gas system related to the reform of oil and gas prices has also been put on the agenda. Since 2014, relevant ministries and commissions have issued some preliminary ideas on the reform of the oil and gas system. Subsequently, the National Energy Administration issued the “Exposure Draft for the Use of Qualified Conditions for the Import of Crude Oil Refinery Enterprises”, which is expected to be formally introduced in 2015.