Development opportunities and potential prediction of new energy and energy storage under the environment of electric carbon market

The establishment of the national carbon market and the continuous improvement of the power market bring new opportunities to the development of new energy and energy storage, and deconstruct the core values and corresponding market space of new energy and energy storage. The core viewpoints are as follows:

1. The larger scale development of new energy will bring a series of problems, and the new power system provides an overall solution. Power system is the most powerful energy infrastructure in China. Relying on the ubiquitous power grid to support the development of new energy is the main way to realize the “double carbon” strategy. The overall goal of developing a new power system is to fully consider policy, industry, market, technology and other constraints, solve the problems of random volatility, low immunity and weak support of new energy, and achieve an acceptable balance in terms of safety, economy and environmental protection.

2. Establishing a sound market mechanism is an important aspect of building a new power system. New energy has the characteristics of low marginal cost, high system cost and green environmental protection. Build a perfect market mechanism: reflect the value of green environmental protection of new energy through the linkage of electricity and carbon market; Through the design of new varieties of power market such as auxiliary services and capacity market, promoting new energy to regulate resources through self construction and purchase is an important condition for the coordinated development of new energy and power system. According to the recently released policies, the competent energy authorities are promoting the construction of markets with different characteristics of new energy.

3. The national carbon trading market is the place for pricing the green value of energy. The basic principle of carbon emission trading market is to build a “carbon asset” to measure the scarcity of carbon emission rights. Based on the principle of “total transaction”, carbon asset pricing is realized by determining the total amount of social emissions and allowing free trading, so as to internalize carbon dioxide emissions, an important externality in the energy field, and guide social production activities to transition to green and low-carbon. Certain liquidity is the lifeline of the sustainable development of the carbon market. At present, the liquidity of the market is still poor, but the trading volume in the last few trading days of September is gradually large, especially on September 30, the largest trading volume in a single day since the opening of the market. With the expansion of the national carbon market and the enrichment of new products, the carbon market price and trading volume are still worth looking forward to.

4. The green power market highlights the green value of new energy. Through institutional innovation, the green power trading market fully reflects the green and low-carbon value of new energy power on the one hand, and provides an inclusive channel for enterprises to obtain green power on the other hand. In the green electricity market, the environmental value and electricity value represented by the green certificate are merged and sold uniformly, which not only realizes the premium (additional electricity price) in the transaction, but also realizes the “integration of electricity and certificate” of green electricity and green certificate, so as to enhance the willingness of new energy to enter the electricity market. Promoting the carbon reduction effect of green power has been recognized in the national carbon market and internationally, which can reduce the performance cost of emission control enterprises in the carbon market and resolve the risk of “carbon tariff” imposed on export enterprises. At the same time, the excess consumption of renewable energy is not assessed in the “dual control” of energy. These three points are the main reasons for the high premium in the green power market. Compared with applying for CCER assets, because CCER is limited by the offset proportion, it is relatively more universal to realize the green value of new energy through the green power market. In theory, under the full linkage of the electricity and carbon markets, the green power premium should be linked to the corresponding carbon quota price.

5. Promoting new energy construction or purchasing peak shaving resources through market means is not only an important driving force for energy storage development, but also a support for the continuous expansion of green power market. If new energy enters the market on a large scale as the main energy, the current preferential transaction organization and Implementation for the results of green power transaction are unsustainable. New energy entering the market will need to consider its own power generation curve and accept deviation assessment, forcing new energy to build or purchase peak shaving resources by itself. The notice on encouraging renewable energy power generation enterprises to build or purchase their own peak shaving capacity and increase the scale of grid connection recently issued by the national development and Reform Commission and the Energy Bureau has initially seen the policy direction. The notice requires that new energy beyond the guaranteed grid connection of power grid enterprises shall configure the peak shaving capacity by means of self construction, joint construction or purchase according to the linkage ratio of 15% of power (more than 4 hours). Long term energy storage ushers in development opportunities. Based on this calculation, the capacity of new energy storage will increase 10 times during the 14th Five Year Plan period and 4 times during the 15th Five Year Plan period. At the same time, due to the low cost of thermal power flexibility transformation, and maintaining the necessary capacity of thermal power units in the power system is an important basis for maintaining the inertia and stability of the power system, the 1 billion kw thermal power flexibility transformation can also produce a trillion level market. Of course, new energy storage and thermal power flexibility transformation have a relationship between one thing and the other, and the follow-up depends on the comparison of their technological development and cost.

Post time: Oct-16-2021