context: The National Development and Reform Commission and the National Energy Administration issued a Notice on promoting green electricity direct connection development on 30 May. The policy aims to connect renewable power generators to independent users directly.
Against the backdrop of a profound restructuring in global climate governance, the latest Notice on green power direct supply represents a significant policy innovation. Aimed at addressing both the energy transition and the challenges posed by international carbon tariffs, the document introduces pilot projects that seek to improve the efficiency of clean energy use and offer practical insights for scaling renewable energy development.
Chen Dayu 陈大宇 Huaneng Group Energy Research Institute deputy director identifies three major advantages in the PRC’s approach
- building a localised framework that is compatible with international rules
- defines GPDS (green power direct supply) as a model where renewable sources deliver electricity to a single user via dedicated lines, without routing through the public grid
- this enables physical traceability of electricity and addresses long-standing concerns about 'greenwashing'
- projects are classified into grid-connected and off-grid types
- in grid-connected models, clear physical and responsibility boundaries are established through property demarcation points
- projects are classified into grid-connected and off-grid types
- the policy returns to the original intention of distributed solar PV by moving beyond traditional 'virtual certificate delivery' systems
- introduces a new model combining physical direct connection and market settlement
- grid-connected projects must follow a 'demand-determined generation' principle and, in areas with active spot markets, prioritise self-consumption while feeding any surplus back into the grid
- these projects are to be treated equally in the market and must register to participate in trading
- electricity loads under these projects cannot rely on grid companies to procure power on their behalf, enhancing user responsibility and autonomy
- introduces a new model combining physical direct connection and market settlement
- strengthens organisational safeguards and encourages innovation in development models
- grid-connected projects are required to enhance operational flexibility by incorporating storage and activating demand-side flexibility
- responsibility lies primarily with the load side, and dedicated transmission lines should generally be financed by the users or generation entities
- this ensures cost-responsibility alignment and discourages 'free-riding' on the public grid
While GPDS presents technical, financial and regulatory challenges, especially regarding reliability and cost competitiveness versus large integrated systems, it offers a path forward for creating decentralised, traceable and market-integrated green power systems, according to Chen.