a legislated energy framework—how is this shifting policy?
- delivers a modern energy strategy: goals for energy security, green transition, and new energy systems
- better guides all energy-related regs and action underpinning energy transition
- promotes demand-side efficiency and conservation
A new Energy Law was passed on 8 November after a long gestation and finally being rushed through three draft readings of the NPC (National People’s Congress) Standing Committee in 2024. It will take effect on 1 January 2025.
The energy sector has until now been regulated through a series of standalone laws: electricity, coal, energy conservation, atomic and renewable energy. No systematic, overarching law guided the sector as a whole.
A basic law was needed to address energy sector challenges and meet carbon targets, explains Chen Xinghua 陈兴华 Energy Law Research Association deputy secretary-general. The ‘dual carbon’ goals (peaking and neutrality) added urgency to the need to legislate the transition to renewable energy, driving the speedy final passage of the law, she says.
The law departs from typical PRC rights-and-duties laws by incorporating policy provisions. It is drafted as a guiding framework rather than solely to enforce compliance, Chen notes. This approach represents an evolution in PRC legislative thinking, she believes.
The new Law contains nine chapters
- general principles
- energy planning
- development and utilisation
- energy market system
- reserves and emergency response
- scientific and technological innovation
- supervision and management
- legal liability
- supplementary provisions
With energy security—critical for economic stability—to the fore, the law sets out to improve resilience and stability of supply amidst the transition to a new energy system, above all robust energy reserves and emergency backup, says Wang Peng 王鹏 North China Electric Power University.
The law requires
- all-round science-based planning, balancing supply/demand over time
- secure coal, oil and gas development to support supply
- enhanced emergency response capability: state and corporate reserves to manage fluctuations or crises
Green transformation, claims Wang is supported through
- explicit goals set for carbon emissions and renewable energy use, making power suppliers and consumers accountable for renewable energy consumption
- specific guidelines for developing renewables, e.g. wind and solar, favouring distributed models and local usage
- strengthened mechanisms for green energy consumption, urging novel modes, e.g. green certificates, and raising the grid's renewable capacity
Better integration of state and market roles runs through the law. The balancing of regulatory oversight with market efficiency aligns with themes of the Party’s July 2024 Plenary Session, notes Wang. ‘Market failure’ (e.g. monopoly trends and resource misallocation) is targeted via regulatory oversight rather than state agency. State-regulated price formation, compatible with the ‘decisive role of’ the market, is maintained and prices remain subject to the Price Law. The state is to ‘guide’ businesses to invest in the sector.
The law does not stipulate a market regulator, as many had expected. State-regulated price formation, compatible with the ‘decisive role of’ the market, is maintained and prices remain subject to the Price Law.
The scope of state intervention is carefully defined, claims Wu Zhonghu 吴钟瑚 Energy Law Research Association, aiming to allow market forces to operate. Wu believes improved oversight will safeguard public interest and promote sustainable practices, and mitigate the risk of monopoly action.
The law gives structure to both state and market roles. An energy system is emerging whereby market principles (e.g. pricing that reflects supply/demand) lead, while the state restricts itself to fairness, safety, and stability issues.
A notable feature is the chapter on science and technology innovation, which underscores the critical role of tech advances in energy development and raises morale among researchers, says Yang Lei 杨雷 Peking University Institute of Energy. Historically, energy growth has been driven by resource exploitation, with fossil fuels powering industrial advancement. However, technological innovation is transforming this model, he says.
The law also stipulates demand-side management, requiring users to fulfil energy-saving obligations, prevent waste and participate in energy demand responses. Local governments are instructed to implement tiered and time-of-use pricing measures to encourage efficient energy use. Time-of-use pricing, peak and off-peak rates, and tiered pricing, where costs increase with higher consumption, are crucial for managing demand and promoting efficiency.
The PRC leads in developing key energy tech and infrastructure and converting tech advances into sector progress, notes Long Guoqiang 隆国强, Development Research Centre of State Council. Yet industry structure, coal dependence and low energy efficiency, he admits, make for a long path to a true green, low-carbon transformation.
energy law experts
Chen Xinghua 陈兴华 | North China University of Technology Energy Law Research Centre director; China Law Society Energy Law Research Association deputy secretary-general
Chen notes the final version of the Energy Law codifies PRC energy development strategy, promotes diverse investment, improves market transparency, and safeguards investor rights, building confidence in the energy sector.
Chen is an influential voice shaping the PRC’s energy law and policy approach. She has long advocated for a policy-driven Energy Law that reflects strategic energy objectives and aligns with energy security, renewable energy integration, and sustainable development priorities. She uses the law as a guiding framework for policy and strategic direction rather than as a purely regulatory or management-focused text. Her approach promotes flexibility, aiming to balance theoretical integrity with practical application.
An associate professor at North China University of Technology, Chen Xinghua is the director of its Energy Law Research Centre. Graduate of Ocean University of China, she specialises in energy, economic, and environmental resource laws. She also serves as the Deputy Secretary General of the Energy Law Research Association of the China Law Society. She has been a core member of China’s Energy Law drafting group since 2007, and worked on the 2020 public consultation draft and the final revision process.
China Law Society Energy Law Research Association | 中国法学会能源法研究会
In early 2005, the China Law Society Energy Law Research Association launched the project: ‘Research on the framework of China’s energy legal system’. Later that year, it reported on ‘The US Energy Policy Act (2005) and recommendations for China’s Energy Law’. This foundational research contributed to the initial stages of the PRC Energy Law, guiding agencies in planning energy legislation. Since January 2006, the National Energy Office and other state agencies have been drafting the Energy Law, with notable contributions from the association’s directors and experts.
A leading think tank in energy law, the China Law Society Energy Law Research Association was formally set up in 1997 with a remit to focus on research, collaboration, and guidance in addressing crucial issues in energy legislation and regulation, thereby reinforcing China’s energy legal framework. The association comprises roughly 130 professionals across industry, academia, research, government, and law, fostering a multidisciplinary approach to energy law. Actively involved in national legislative initiatives, the association advises on policies and supports the development of the PRC’s energy legal framework.