NDRC: Encouragement of incremental distribution grid business with the main objective of meeting the near-by consumption of renewable energy!

On April 2, the National Development and Reform Commission (NDRC) released on its official website the "Implementation Measures for the Division of Distribution Areas for Incremental Power Distribution Businesses" (hereinafter referred to as the "Measures"), which proposed that, "Within a distribution area, only one enterprise can own the right to operate the distribution network, and fulfill the obligations of universal service of electricity society, guaranteed power supply service and non-discriminatory provision of distribution service in accordance with the relevant provisions. power supply service and non-discriminatory provision of power distribution service obligations, fulfill the obligation of transferring the right to operate the distribution grid when withdrawing from the power distribution business, and shall continue to fulfill the relevant obligations before the transfer of the right to operate the distribution grid."

With regard to the participation of renewable energy in power distribution, the measures particularly encourage and support. The measures proposed: "Encourage the incremental power distribution business with the main objective of meeting renewable energy consumption in the vicinity, and support the division of distribution areas based on the scope of its renewable energy power supply, power load and other circumstances. It shall not rely on coal-fired captive power plants to build incremental distribution grids, and prevent cost advantages from being created at the expense of avoiding social responsibility."

See below for full text:

National Development and Reform Commission National Energy Administration on the issuance ofDivision of Distribution Areas for Incremental Distribution OperationsNotification of the Means of Implementation

NDRC Energy Regulation [2024] No. 317

Development and Reform Commission and Energy Bureau of each province, autonomous region, municipality directly under the central government, Xinjiang Production and Construction Corps, the dispatching organizations of the National Energy Administration, and relevant central enterprises:

In order to standardize the division of distribution areas for incremental distribution business and actively and steadily promote the reform of incremental distribution business, the National Development and Reform Commission and the National Energy Administration have revised the Implementation Measures for the Division of Distribution Areas for Incremental Distribution Business. Hereby issued to you, please follow the implementation. The Implementation Measures for the Division of Distribution Areas for Incremental Power Distribution Businesses (for Trial Implementation) (NDRC Energy Regulation [2018] No. 424) is repealed at the same time.

PRC National Development and Reform Commission

National Energy Administration

March 15, 2024

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