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Guangxi's new energy storage capacity leasing costs 160-230 yuan/kWh, and peak shaving costs 0.396 yuan/kWh!

2023/4/8

In April 2023, the Guangxi Development and Reform Commission issued the "Several Measures to Accelerate the Construction of New Energy Storage Demonstration Projects in Guangxi (Trial)". The document clearly states that the demonstration project will participate in the electricity market as an independent energy storage market entity. And propose the following content:
1. Promote demonstration projects to participate in the electricity market.
Research and clarify the participation of demonstration projects in the medium to long term electricity market, spot electricity market, auxiliary service market trading and settlement mechanisms. Demonstration projects can be registered as power generation enterprises and power users to participate in transactions. Under the same conditions, priority will be given to transaction, clearance, and settlement according to market trading rules and price mechanisms. Before the official operation of the Guangxi electricity spot market, the demonstration project mainly participated in the electricity auxiliary service market and the medium to long-term electricity market transactions.
2. Establish a capacity leasing mechanism for demonstration projects.
Encourage market-oriented grid connected new energy projects to allocate energy storage needs by leasing demonstration project capacity throughout the region. The annual capacity lease fee price for the demonstration project is determined through independent negotiation among various investment entities (with a reference range of 160-230 yuan/kWh). Encourage investment entities in market-oriented grid connected new energy projects and demonstration projects to sign capacity leasing agreements or contracts that match the entire life cycle of new energy projects.
3. Promote the participation of demonstration projects in various types of power auxiliary services.
The demonstration project participates in the auxiliary service market in accordance with relevant regulations such as the Notice of the Southern Regulatory Bureau of the National Energy Administration on Issuing the Implementation Rules for the Management of Grid Connection Operation in the Southern Region and the Implementation Rules for the Management of Auxiliary Services in the Southern Region (Southern Regulatory Market [2022] No. 91). The compensation standard for participating in peak shaving auxiliary services in the demonstration project is 396 yuan/megawatt hour.
The market-oriented grid connected new energy project that meets the requirements for energy storage configuration has been completed through capacity leasing, and will not participate in the allocation of peak shaving auxiliary service fees temporarily. Adjustments will be made later depending on the situation. As the market mechanism gradually improves, the auxiliary service categories included in the demonstration projects will be expanded in a timely manner. We will actively promote the priority participation of demonstration projects in primary and secondary frequency modulation auxiliary service transactions, and encourage demonstration projects to participate in auxiliary service transactions such as voltage regulation, black start, and backup.
4. Improve the pricing mechanism for demonstration projects.
Before participating in the electricity market transactions for the demonstration project, the electricity price for charging electricity shall be temporarily implemented according to the single electricity price standard for purchasing electrical, commercial, and other electricity categories by power grid enterprises, and the peak valley time of use electricity price policy shall be implemented; As a power generation enterprise during discharge, the grid electricity price is temporarily based on the average benchmark price of 0.4207 yuan/kWh for coal-fired power generation in Guangxi.
After participating in the electricity market transaction of the demonstration project, the corresponding charging electricity will not bear the transmission and distribution electricity price, government funds, and surcharges. Based on the actual situation of electricity supply and demand in Guangxi, optimize and improve the peak valley time of use electricity price policy, and appropriately increase the peak valley price difference in a timely manner. The relevant departments of electricity market trading guide demonstration projects to sign electricity and electricity price contracts with curves during peak and low periods, creating development space for demonstration projects in serving the user side. Explore incorporating the cost benefits of grid alternative energy storage facilities into the recovery of transmission and distribution electricity prices.
5. Strengthen scheduling and operation management.
Accelerate the formulation of relevant rules for the scheduling and operation management of new energy storage facilities, and adhere to optimizing the scheduling and operation of new energy storage facilities in a market-oriented manner. Scientifically deploy new energy storage facilities and fully leverage the demonstration effect and system benefits of demonstration projects. In principle, the effective full capacity call and discharge frequency of demonstration projects shall not be less than 300 times per year, among which the effective full capacity call and discharge frequency of demonstration projects completed and put into operation before the end of June 2023 shall not be less than 330 times per year. In order to ensure the stable supply of electricity and the safety and stability of the power grid, during special periods such as tight power supply, the power dispatch agency can uniformly dispatch and operate new energy storage facilities as needed, and compensate in accordance with relevant regulations or market-oriented rules.
The original text is as follows:
Accelerate the promotion of new energy storage in Guangxi
Several Measures for Demonstration Project Construction (Trial)
In order to establish a market mechanism and policy environment that adapts to the participation of new energy storage, accelerate the development of new energy storage in Guangxi, accelerate the demonstration application of advanced energy storage technology and the construction of new energy storage demonstration projects (hereinafter referred to as demonstration projects), in accordance with the Guiding Opinions of the National Development and Reform Commission and the National Energy Administration on Accelerating the Development of New Energy Storage (NDRC Energy Regulations [2021] No. 1051) Notice of the National Energy Administration on Issuing the Management Standards for New Energy Storage Projects (Provisional) (National Energy Development and Reform Commission Science and Technology Regulations [2021] No. 47), Notice of the National Energy Administration on Issuing the Implementation Plan for New Energy Storage Development during the 14th Five Year Plan period (National Energy Development and Reform Commission [2022] No. 209) According to the requirements of documents such as the Notice of the General Office of the National Development and Reform Commission and the Comprehensive Department of the National Energy Administration on Further Promoting the Participation of New Energy Storage in the Electricity Market and Dispatching Application (Development and Reform Office Operation [2022] No. 475), combined with the actual situation of our district and the needs of promoting the construction of demonstration projects, the following measures are formulated.
1、 Accelerate the market-oriented development of demonstration projects
（1） Clarify the market position of demonstration projects as independent energy storage entities. Determine the market position of independent energy storage as a demonstration project included in the autonomous region's centralized sharing of new energy storage. The demonstration project can participate in the electricity market as an independent entity after meeting the technical conditions of independent measurement, control, etc., being connected to the dispatch automation system and being monitored and dispatched by the power grid, and meeting relevant standards and specifications as well as the admission conditions of the electricity market.
（2） Promote demonstration projects to participate in the electricity market. Research and clarify the participation of demonstration projects in the medium to long term electricity market, spot electricity market, auxiliary service market trading and settlement mechanisms. Demonstration projects can be registered as power generation enterprises and power users to participate in transactions. Under the same conditions, priority will be given to transaction, clearance, and settlement according to market trading rules and price mechanisms. Before the official operation of the Guangxi electricity spot market, the demonstration project mainly participated in the electricity auxiliary service market and the medium to long-term electricity market transactions.
（3） Establish a capacity leasing mechanism for demonstration projects. Encourage market-oriented grid connected new energy projects to allocate energy storage needs by leasing demonstration project capacity throughout the region. The annual capacity lease fee price for the demonstration project is determined through independent negotiation among various investment entities (with a reference range of 160-230 yuan/kWh). Encourage investment entities in market-oriented grid connected new energy projects and demonstration projects to sign capacity leasing agreements or contracts that match the entire life cycle of new energy projects.
（4） Promote the participation of demonstration projects in various types of power auxiliary services. The demonstration project participates in the auxiliary service market in accordance with relevant regulations such as the Notice of the Southern Regulatory Bureau of the National Energy Administration on Issuing the Implementation Rules for the Management of Grid Connection Operation in the Southern Region and the Implementation Rules for the Management of Auxiliary Services in the Southern Region (Southern Regulatory Market [2022] No. 91). The compensation standard for participating in peak shaving auxiliary services in the demonstration project is 396 yuan/megawatt hour. The market-oriented grid connected new energy project that meets the requirements for energy storage configuration has been completed through capacity leasing, and will not participate in the allocation of peak shaving auxiliary service fees temporarily. Adjustments will be made later depending on the situation. As the market mechanism gradually improves, the auxiliary service categories included in the demonstration projects will be expanded in a timely manner. We will actively promote the priority participation of demonstration projects in primary and secondary frequency modulation auxiliary service transactions, and encourage demonstration projects to participate in auxiliary service transactions such as voltage regulation, black start, and backup.
（5） Improve the pricing mechanism for demonstration projects. Before participating in the electricity market transactions for the demonstration project, the electricity price for charging electricity shall be temporarily implemented according to the single electricity price standard for purchasing electrical, commercial, and other electricity categories by power grid enterprises, and the peak valley time of use electricity price policy shall be implemented; As a power generation enterprise during discharge, the grid electricity price is temporarily based on the average benchmark price of 0.4207 yuan/kWh for coal-fired power generation in Guangxi. After participating in the electricity market transaction of the demonstration project, the corresponding charging electricity will not bear the transmission and distribution electricity price, government funds, and surcharges. Based on the actual situation of electricity supply and demand in our region, optimize and improve the peak valley time of use electricity price policy, and appropriately increase the peak valley price difference in a timely manner. The relevant departments of electricity market trading guide demonstration projects to sign electricity and electricity price contracts with curves during peak and low periods, creating development space for demonstration projects in serving the user side. Explore incorporating the cost benefits of grid alternative energy storage facilities into the recovery of transmission and distribution electricity prices.
2、 Guide the orderly construction of demonstration projects
（1） Guide the rational layout of demonstration projects. In accordance with the relevant requirements of the National Energy Administration's "Regulations on the Management of New Energy Storage Projects (Provisional)" (National Energy Development and Reform Commission [2021] No. 47), the Development and Reform Commission of the Autonomous Region shall organize the preparation of a new energy storage development plan for the entire region under the guidance of land and space planning. Priority shall be given to areas with high risk of new energy abandonment, areas with large-scale new energy convergence, key nodes with low levels of safe and stable operation of the power grid, and comprehensive consideration shall be given to urban and rural development Fire safety, transportation, hydrogeology, and other requirements require a centralized, large-scale, and reasonable layout of new energy storage projects, to play the role of "one station, multiple uses" of new energy storage. Establish a planned reserve database for new energy storage projects in the entire region, which will be updated annually. The demonstration project should comply with the planning layout and carry out relevant preliminary work under the guidance of the planning.
（2） Carry out demonstration project construction as needed. The Development and Reform Commission of the Autonomous Region will arrange the construction of new energy storage demonstration projects in batches based on the actual needs of the development of new energy and power systems in the entire region. Support various market entities to participate in the construction of demonstration projects, focusing on supporting the construction of market-oriented grid connected new energy projects, alleviating the power supply pressure during peak hours of the power grid, delaying the expansion and upgrading of power transmission and distribution facilities, improving the power grid regulation and new energy consumption capabilities, and enhancing the power emergency support capabilities. Encourage and guide new energy generation enterprises with energy storage configuration needs to implement configuration requirements through joint construction of demonstration projects, leasing, purchasing demonstration project capacity, and other means.
（3） Increase policy support for demonstration projects. Strengthen the guarantee of key elements, and in accordance with the Notice of the People's Government of Guangxi Zhuang Autonomous Region on Issuing the Interim Measures for the Management of Major Projects in Guangxi Zhuang Autonomous Region (Gui Zheng Fa [2011] No. 70), include eligible demonstration projects into the overall promotion of major projects at the autonomous region level according to the procedures, and provide equal protection for their land, forest, water, electricity and other elements. Each district or city where the demonstration project is located should provide guidance and prioritize supporting demonstration projects that comply with policy funding to be included in the application plan or support scope. Implement relevant tax preferential policies according to regulations. Encourage financial investment institutions to include demonstration projects in the scope of green finance support, encourage the provision of preferential credit support measures, and innovate financial services.
3、 Strengthen institutional management
（1） Improve filing management. The implementation of new energy storage projects is subject to local filing management. Within one month after the release of each batch of energy storage demonstration projects, the development and reform commissions of each district and city shall submit the relevant information of the demonstration projects registered within their jurisdiction to the development and reform commission of the autonomous region and copy it to the Southern Supervision Bureau of the National Energy Administration and the Department of Industry and Information Technology of the autonomous region. The project registration content, project changes, construction requirements, etc. shall be executed in accordance with the National Energy Development and Reform Commission's Science and Technology Regulations [2021] No. 47 document.
（2） Strengthen grid connection management. Power grid enterprises should coordinate the planning and construction of power grids in accordance with the requirements of the "Regulations on Fair and Open Supervision of Power Grids". Focusing on demonstration projects, establish and optimize the construction management process of grid connection engineering projects that match the construction cycle of new energy storage projects, accelerate the introduction of new energy storage grid connection technology requirements, clarify the grid connection, debugging and acceptance process and work time limit, and provide grid connection services for new energy storage projects fairly and without discrimination. Priority should be given to the construction of demonstration project grid connection line projects by power grid enterprises. For demonstration project grid connection line projects that have difficulties or mismatched construction schedules for power grid enterprises, they can be constructed by the investment subject of the demonstration project on a voluntary basis.
（3） Strengthen scheduling and operation management. Accelerate the formulation of relevant rules for the scheduling and operation management of new energy storage facilities, and adhere to optimizing the scheduling and operation of new energy storage facilities in a market-oriented manner. Scientifically deploy new energy storage facilities and fully leverage the demonstration effect and system benefits of demonstration projects. In principle, the effective full capacity call and discharge frequency of demonstration projects shall not be less than 300 times per year, among which the effective full capacity call and discharge frequency of demonstration projects completed and put into operation before the end of June 2023 shall not be less than 330 times per year. In order to ensure the stable supply of electricity and the safety and stability of the power grid, during special periods such as tight power supply, the power dispatch agency can uniformly dispatch and operate new energy storage facilities as needed, and compensate in accordance with relevant regulations or market-oriented rules.
（4） Establish a sound safety management system. Focusing on demonstration projects, establish a safety management system covering the entire process of planning and design, construction and commissioning, testing and certification, safety prevention and control, emergency response, quality supervision, and environmental supervision for new energy storage. Strengthen the supervision and evaluation of the operation of new energy storage projects, and demonstration projects should be connected to the national new energy storage big data platform as required. All relevant cities and counties should strictly implement their territorial responsibilities, strengthen project safety supervision, guidance, and supervision and inspection. The project industry mainly strictly fulfills the main responsibility of safety production, complies with safety production laws, regulations, and standards, implements the full staff safety production responsibility system, and establishes and improves a dual prevention system of risk grading management and hidden danger investigation and governance. Strengthen communication and coordination, work with relevant departments to strengthen safety supervision of electrochemical energy storage power plants, establish a linkage mechanism, and enhance the emergency fire response capacity of electrochemical energy storage power plants.
（5） Strengthen the assessment of energy storage capacity configuration. For market-oriented grid connected new energy projects that fail to fulfill their commitments for new energy storage construction or lease new energy storage capacity in accordance with the promised proportion, efforts will be made to allocate auxiliary service costs, and priority will be given to sharing costs during low periods in accordance with relevant requirements. If the investment entities of market-oriented grid connected new energy projects fail to complete the energy storage configuration requirements as promised, the Development and Reform Commission of the Autonomous Region will assess the allocation of new energy project construction indicators in subsequent years.
（6） Strictly implement equipment application standards. Implement the national and industry energy storage standards system, strengthen the effective connection with current energy and electricity standards, and formulate local standards in a timely manner. The demonstration project should have independent measurement, control and other technical conditions, and can be monitored and dispatched by the power grid when connected to the dispatch automation system. The continuous discharge time under the effective full capacity of the demonstration project should not be less than 2 hours, and the number of complete charges and discharges should not be less than 6000 times without replacing the main equipment. The depth of charges and discharges should not be less than 90%.
（7） Strengthen technical supervision of demonstration projects. Before the grid connection acceptance of the demonstration project, type testing, whole station testing, and grid connection testing of the main equipment and systems of the power station should be completed in accordance with the relevant requirements of the Notice on Strengthening the Safety Management of Electrochemical Energy Storage Power Stations issued by the National Energy Administration. The grid related equipment should meet the technical requirements for safe operation of the power grid. The project owner should do a good job in monitoring the operation status of the project. In the first three years of operation, network related performance testing should be conducted annually, and after three years, a whole station testing including network related performance testing should be conducted annually. When the project reaches its design life or the safety operation status does not meet relevant technical requirements, timely organization, demonstration, evaluation, and rectification work should be organized; If the project still does not meet the relevant requirements after rectification, measures for project retirement should be taken in a timely manner, and the original filing authority and other relevant units should be reported in a timely manner.
This measure shall be implemented from the date of issuance (referring to demonstration projects completed and put into operation before this) and shall be valid until December 31, 2025. Timely adjust according to the development and construction of new energy storage in the entire region and changes in national policies.

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