Economic Impact Assessment of the Dual-track Electricity Price System in China

With the continuing advance of electricity market reforms, China is currently in the transition stage from a dual-track electricity price system to a market-based single-track system. The new electricity price system, which is based on market transaction electricity prices and transmission and distribution prices; and the original electricity price system, which is based on the feed-in tariffs price and catalog electricity prices, are dual-track operation. Based on the evolution path of China's macro development, this paper clarifies the connotation and settlement mechanism of China's dual-track electricity price system and discusses the differences and connections between the dual-track system settlement, planned settlement, and market-based settlement. Then, by adopting an adjusted Computable General Equilibrium (CGE) model, this paper quantitatively evaluates the economic and social benefits of the dual-track electricity price system. Based on these results, this paper further analyses the subsequent challenges and countermeasures of the transition from the dual-track electricity price system to the market-oriented price system.