FEEM working papers "Note di lavoro"
2018.018
Date: 21/5/2018

Energy Price Reform in China


Authors:
ZhongXiang Zhang (Ma Yinchu School of Economics, China Academy of Energy, Environmental and Industrial Economics - Tianjin University)
JEL n.: H23, H71, O13, O53, P22, Q41, Q43, Q48, Q53, Q58
Keywords: Energy Prices, Tiered Prices, Differentiated Tariffs, Coal, Electricity, Natural Gas, Petroleum Products, Renewable Power, Desulfurization and Denitrification, State-owned Enterprises, China

Abstract

The Chinese leadership has determined to assign the market a decisive role in allocating resources. To have the market to play that role, getting the energy prices right is crucial because this sends clear signals to both producers and consumers of energy. While the overall trend of China’s energy pricing reform since 1984 has been moving away from the prices set by the central government in the centrally planned economy and towards a more market-oriented pricing mechanism, the pace and scale of the reform differ across energy types. This article discusses the evolution of price reforms for coal, petroleum products, natural gas, electricity and renewable power in China, and provides some analysis of these energy price reforms, in order to have the market to play a decisive role in allocating resources and help China’s transition to a low-carbon economy.

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Suggested citation: Zhang, Z. (2018), 'Energy Price Reform in China', Nota di Lavoro 18.2018, Milano, Italy: Fondazione Eni Enrico Mattei


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