North Star Energy Storage Network News: Recently, the Shanghai People's Congress announced a proposal to formulate the Shanghai Industrial and Commercial Energy Storage Regulations. The document proposes comprehensive and specific directions for the market positioning, business models, and standard formulation of developing industrial and commercial energy storage. The document proposes to actively explore the implementation mode of wall mounted electricity sales. Encourage distributed projects to directly sell electricity to electricity users in the same substation area who meet policies and conditions. The electricity price is negotiated between the supply and demand parties, and an energy service agreement is signed. The power grid enterprise is responsible for transmission and electricity fee settlement. It is recommended to implement partition wall electricity sales in the selected area or industrial park, and to develop implementation rules as soon as possible to connect the last mile. Suggest improving the industrial and commercial energy storage settlement mechanism. It is recommended to refer to the distributed photovoltaic settlement system, where the State Grid of China will uniformly install measurement meters and authoritative third parties will calculate the energy storage revenue. Promoting measures such as reducing transmission and distribution fees and demand fees during the charging period of industrial and commercial energy storage can effectively incentivize the charging of industrial and commercial energy storage during low demand periods, and improve the utilization efficiency of industrial and commercial energy storage. Reduce the operating costs of enterprises and encourage more enterprises to invest and use energy storage technologies. At the same time, a market trading mechanism for energy storage should be established, allowing industrial and commercial energy storage to independently participate in various trading links in the electricity market, such as electricity trading, electricity price trading, auxiliary services, demand response, etc., providing diversified sources of income for energy storage, increasing the return on investment of energy storage, and promoting the market-oriented development of energy storage. According to the official website, this proposal was jointly proposed by 18 people, including Zhu Keding, the representative of the proposal, who is the Chairman and General Manager of Shanghai Aineng Electric Power Engineering Co., Ltd. The original text is as follows:
Proposal on Formulating the Shanghai Industrial and Commercial Energy Storage Regulations
Zhu Keding
Industrial and commercial energy storage refers to the installation of energy storage equipment on the side of industrial and commercial users. Through the charging and discharging of energy storage systems, it achieves multiple values such as electricity cost optimization, grid service revenue, and new energy consumption. Industrial and commercial energy storage is an important component of the energy storage industry and an effective means of promoting energy transformation and carbon neutrality. As the economic center and international metropolis of China, Shanghai is currently facing a complex pattern of sustained growth in energy consumption and increasingly prominent peak and valley electricity demand. It is facing enormous pressure from power grid regulation and shoulders the important mission of reducing carbon emissions. Industrial and commercial energy storage, as a flexible distributed energy resource, can provide effective solutions for energy supply and demand balance, electricity market trading, grid security and stability, carbon neutrality goals, and other aspects in Shanghai. At present, Shanghai does not have a special policy for industrial and commercial energy storage, which has led to certain constraints and obstacles in the development of industrial and commercial energy storage. However, in the draft of the Shanghai Action Plan for Promoting High quality Innovation and Development of New Energy Storage Industry (2023-2025) for soliciting opinions, it can be seen that Shanghai has foresight in promoting the high-quality development of new energy storage industry, supporting green, low-carbon and future industrial innovation layout. Therefore, it is also urgent to formulate laws and regulations suitable for the current and future industrial and commercial energy storage field in Shanghai according to the Action Plan. It can provide direction for the construction, operation, and management of industrial and commercial energy storage, promote the development of industrial and commercial energy storage in Shanghai, and improve the power system in Shanghai. Cleanliness, safety, and flexibility to achieve "dual carbon" in Shanghai The goal provides strong support. Therefore, it is recommended to formulate the Shanghai Industrial and Commercial Energy Storage Regulations
1、 Cause of action
Industrial and commercial energy storage is one of the important application areas of energy storage technology, and it is also an effective way to promote energy transformation and low-carbon development. However, according to the 2022 China Energy Storage Market Development Report, Shanghai has some problems in the development of industrial and commercial energy storage.
The scale of the industrial and commercial energy storage market in Shanghai is relatively small. In 2022, the scale of China's industrial and commercial energy storage market was only 1.2 gigawatt hours, accounting for 5.6% of the national energy storage market, far lower than the 23.4% in the United States and 18.7% in Europe, and mainly concentrated in a few provinces such as Guangdong, Jiangsu, and Zhejiang. The scale of Shanghai's industrial and commercial energy storage market was only 0.02 gigawatt hours, accounting for 1.7% of the national industrial and commercial energy storage market, ranking twelfth in the country, which is inconsistent with Shanghai's position and image as a national economic center.
2. The electricity efficiency of Shanghai's industrial and commercial industry is lower than the national average level. In 2022, the industrial and commercial electricity consumption in Shanghai was 180 million kilowatt hours, accounting for 68.2% of the city's electricity consumption. It is the main electricity consumer in Shanghai, but the efficiency of industrial and commercial electricity consumption in Shanghai is only 0.8, lower than the national average level of 0.9, and there is a huge difference between peak and valley electricity consumption, which poses a threat to the stability and safety of the power grid.
These data and phenomena indicate that although there is still a significant mismatch and gap between Shanghai's development level in the field of industrial and commercial energy storage and its energy structure and established energy goals. At the same time, it also proves that Shanghai has enormous development potential in the field of industrial and commercial energy storage. It is urgent to strengthen policy support and market guidance for industrial and commercial energy storage to stimulate this potential and promote the standardized, large-scale, and market-oriented development of industrial and commercial energy storage.
This proposal aims to promote the rapid and healthy development of industrial and commercial energy storage in Shanghai, provide more electricity options and discounts for industrial and commercial users in Shanghai, provide more services and support for the power grid in Shanghai, and provide more impetus and contributions for Shanghai's energy transformation and low-carbon development. According to the proposed goals and measures of this proposal, it is expected that by 2030, the market size of industrial and commercial energy storage in Shanghai will reach 10 gigawatt hours, accounting for 15% of the national industrial and commercial energy storage market size, ranking third in the country. The operating efficiency of industrial and commercial energy storage in Shanghai will reach 85%, the operating income of industrial and commercial energy storage in Shanghai will reach 0.5 yuan/kilowatt hour, and the electricity efficiency of industrial and commercial electricity in Shanghai will reach 1.2. The fluctuation of peak and low periods of industrial and commercial electricity consumption in Shanghai will be reduced by 30%, and the carbon emission intensity of industrial and commercial electricity in Shanghai will be reduced by 40%.
2、 Case evidence
According to the energy development plan and goals of Shanghai, the development of industrial and commercial energy storage is of great significance and value for Shanghai's energy transformation and carbon neutrality. The following are some relevant policies that have been introduced as evidence.
The 14th Five Year Plan for Energy Development in Shanghai proposes to accelerate energy transformation, build a clean, low-carbon, safe and efficient energy system, achieve energy supply and demand balance, optimize structure, improve quality, and ensure safety and controllability. Among them, we need to accelerate the research and application of new energy storage technologies, leverage the diverse functions of energy storage such as peak shaving and frequency regulation, emergency backup, and capacity support, encourage energy storage to provide various regulation services for new energy and power users, and orderly promote the coordinated development of energy storage and new energy.
The Implementation Plan for Carbon Peaking in Shanghai proposes to accelerate the promotion of carbon peaking actions, achieve the peak of carbon emissions in the city by 2025, and strive to reduce carbon emissions by more than 30% by 2030 compared to 2020. Among them, we need to accelerate the low-carbon transformation of the power system, vigorously develop renewable energy, improve the consumption capacity of renewable energy, establish a sound market-oriented mechanism for renewable energy and energy storage, and promote the coordinated development of energy storage, distributed energy, and intelligent microgrids.
3. The Shanghai Action Plan for Targeting the New Track and Promoting the Development of Green and Low Carbon Industries (2022-2025) proposes to accelerate the development of green and low-carbon industries and create a group of green and low-carbon industry clusters with international competitiveness. Among them, we need to accelerate the development of new energy vehicles and energy storage industries, strengthen innovation and application promotion of energy storage technologies, and improve the technological level and market competitiveness of the energy storage industry.
4. The "Regulations on Promoting the Green Transformation of Development Methods in Shanghai" propose to adhere to the principles of ecological priority, conservation and intensification, innovation driven, and collaborative efficiency enhancement to promote the green transformation of development methods, establish a diversified governance mechanism guided by the government, market led, social coordination, and public participation, form an institutional system that coordinates and promotes the efficient utilization of energy resources, high-level protection of the ecological environment, and high-quality economic and social development, and achieve a transformation towards a green and low-carbon model of resource conservation, environmental friendliness, and ecological balance.
5. The draft action plan for promoting high-quality innovative development of the new energy storage industry in Shanghai (2023-2025) proposes to vigorously carry out multi scenario applications of new energy storage, cultivate key industries of new energy storage, and lay out forward-looking key technologies of energy storage. By 2025, the new energy storage will enter the initial stage of commercial application from demonstration application and transform towards large-scale development, with the overall scale of new energy storage in the city reaching 200 billion yuan. Build 2 or more new energy storage industrial parks and cultivate 10 or more leading new energy storage enterprises.
In addition to these policy evidences, there are also some data and facts that can prove the important role of the development of industrial and commercial energy storage in Shanghai's energy transformation and carbon neutrality, for example.
According to data from the Shanghai Municipal Bureau of Statistics, the total energy consumption in Shanghai in 2022 was 118 million tons of standard coal, of which non fossil energy accounted for 18.0%. Although it has increased compared to 2021, it is still lower than the national average of 25.9%. The total electricity consumption in Shanghai is 188 million kilowatt hours, of which renewable energy accounts for 10.5%, which is also lower than the national average of 36.0%. This indicates that there is still a lot of room for optimization in the energy and electricity structure of Shanghai, and it is necessary to accelerate the development of clean and renewable energy, and reduce carbon emission intensity. Shanghai is actively promoting energy structure adjustment and low-carbon transformation, striving to improve the consumption capacity and proportion of non fossil and renewable energy, and contributing to achieving carbon peak and carbon neutrality goals. The addition of energy storage can improve the utilization rate of clean energy, while also promoting the further expansion of clean and renewable energy.
According to the 2021 data only released by Shanghai Electric Power Company, considering the continuous growth of Shanghai's electricity load peak, it is estimated to reach 35.8455 million kilowatts in 2022, a year-on-year increase of 3.9%. During the peak summer electricity consumption period, a large number of electrical equipment such as air conditioning are turned on, leading to increased peak load regulation and pressure on the power grid, posing a challenge to the safety and stability of power supply. Meanwhile, the estimated installed capacity of renewable energy in Shanghai is expected to reach 2.9106 million kilowatts in 2022, accounting for 8.1% of the total installed capacity of the city. Among them, the expected installed capacity of wind power is 1.2996 million kilowatts, and the expected installed capacity of photovoltaic power is 1.5645 million kilowatts, accounting for 3.6% and 4.4% of the total installed capacity of the city, respectively. These data not only reflect the effectiveness of Shanghai's energy transformation, but also expose the difficulty of improving the consumption level of renewable energy and optimizing the energy structure in Shanghai. With the further development of renewable energy, the power system in Shanghai needs to increase flexibility and response capabilities, accelerate the development of distributed energy resources such as energy storage, and improve the functions of peak shaving, frequency regulation, emergency backup, and capacity support of the power grid.
The total carbon emissions in Shanghai in 2022 were approximately 241 million tons, a year-on-year decrease of 2.4%. The estimated carbon emission intensity in Shanghai is 0.19 tons/10000 yuan, a year-on-year decrease of 9.5%. Although the carbon emissions level in Shanghai has decreased to some extent, it is still higher than the national average of 0.16 tons/10000 yuan, and there is still a significant gap between reaching the peak of carbon emissions and achieving carbon neutrality goals. According to the Shanghai Carbon Peak Implementation Plan, Shanghai aims to achieve the city's peak carbon emissions by 2025 and strive to reduce the city's carbon emissions by more than 30% by 2030 compared to 2020. This means that within the next 10 years, Shanghai will reduce its total carbon emissions from 247 million tons to 173 million tons, and its carbon emission intensity from 0.21 tons/10000 yuan to 0.15 tons/10000 yuan. This is a very challenging task. This indicates that the carbon emission reduction work in Shanghai needs to be accelerated. It is necessary to accelerate the low-carbon transformation of the power system, vigorously develop renewable energy, improve the consumption capacity of renewable energy, and reduce the carbon emission intensity of the power system.
In summary, the development of industrial and commercial energy storage is of great significance and value for Shanghai's energy transformation and carbon neutrality, and is also in line with Shanghai's energy development plan and goals. Therefore, formulating the "Shanghai Industrial and Commercial Energy Storage Policy" is a necessary and urgent task, which is conducive to promoting the development of industrial and commercial energy storage in Shanghai, improving the cleanliness, safety, and flexibility of the Shanghai power system, and providing strong support for Shanghai to achieve the "dual carbon" goal.
3、 Suggestion
Therefore, it is recommended to formulate the Shanghai Industrial and Commercial Energy Storage Regulations
1. Clarify the market positioning and policy support for industrial and commercial energy storage, establish business models, and encourage diversified forms and technologies of energy storage
(1) Develop pricing methods for industrial and commercial energy storage. Based on the different functions and services of energy storage, determine the prices for charging, discharging, capacity, etc. of energy storage, reflect the value and cost of energy storage, and ensure the profitability level of energy storage.
(2) Develop profit distribution for industrial and commercial energy storage. Determine the distribution method of energy storage benefits based on different participants and roles, balance the benefits and risks of energy storage, and incentivize the investment and operation of energy storage.
(3) Develop risk sharing for industrial and commercial energy storage. Based on the different sources and impacts of energy storage risks, determine the risk sharing mechanism for energy storage, share the risks and losses of energy storage, and ensure the safety and stability of energy storage.
(4) Develop a capacity compensation policy for peak shaving energy storage power stations. The grid side energy storage participates in peak shaving and provides compensation, and introduces a third-party independent entity to carry out the electricity auxiliary service market for rotating reserve variety trading.
(5) Increase support for the promotion and application of industrial and commercial energy storage technologies. Encourage energy storage enterprises to cooperate with industrial and commercial users, power generation companies, power grid companies, etc., carry out demonstration and promotion of energy storage, and improve the application level and market share of energy storage.
(6) Promote intelligent microgrid technology. Intelligent microgrid technology is an important means to achieve energy decentralization and intelligence. Encourage enterprises to increase investment and application of intelligent microgrid technology, achieve interconnection and interoperability between energy storage systems and distributed energy and intelligent devices through intelligent microgrids, and improve the intelligence level of energy utilization.
(7) Explore the establishment of a positive incentive mechanism for green finance related to industrial and commercial energy storage, and support financial institutions to actively develop and expand green credit, green bonds, and other businesses related to energy storage.
2. Strengthen the planning and construction of industrial and commercial energy storage, and promote the coordinated development of energy storage with distributed energy and intelligent microgrids
(1) Develop planning guidance for industrial and commercial energy storage. Based on factors such as urban electricity demand, grid characteristics, and land conditions, determine the overall goals, scale range, layout direction, and priority areas of industrial and commercial energy storage, and guide the rational layout and development of industrial and commercial energy storage.
(2) Develop construction standards for industrial and commercial energy storage. Based on the different forms and technologies of energy storage, determine the standards and specifications for the design, construction, operation, maintenance, and other aspects of energy storage, regulate the market behavior of energy storage, improve the quality assurance of energy storage, and ensure the safe and reliable operation of energy storage.
(3) Build a distributed energy storage system. Encourage the construction of distributed energy storage systems in industrial parks, commercial centers, residential areas, and other areas to achieve decentralized and intelligent energy management. By building a distributed energy storage system, it can meet the energy needs of different regions and improve energy utilization efficiency.
(4) Develop a collaborative mechanism for industrial and commercial energy storage. Based on the different collaborative modes of energy storage, distributed energy, and intelligent microgrids, determine the collaborative methods, conditions, and effects of energy storage, promote effective collaboration between energy storage, distributed energy, and intelligent microgrids, improve the comprehensive benefits of energy storage, and accelerate the cultivation of a multi industry integrated collaborative development system.
(5) Actively explore the implementation model of wall mounted electricity sales. Selling electricity through walls is beneficial for the nearby consumption of distributed energy, while significantly reducing transmission and distribution costs and improving the utilization rate of distributed energy. Providing legal basis and policy guidance for wall mounted electricity sales can ensure the efficient implementation of wall mounted electricity sales, including clarifying technical standards and operational processes such as taxation, access, and trading. Distributed projects are encouraged to directly sell electricity to electricity users in the same substation area who meet policies and conditions. The electricity price is negotiated between the supply and consumption parties, and an energy service agreement is signed. The power grid enterprise is responsible for transmission and electricity fee settlement. It is recommended to implement partition wall electricity sales in the selected area or industrial park, and to develop implementation rules as soon as possible to connect the last mile.
3. Strengthen technological innovation and standard formulation for industrial and commercial energy storage, improve the technical level and quality assurance of energy storage
(1) Increase support for technological research and innovation in energy storage. Encourage energy storage enterprises to cooperate with universities, research institutions, industry associations, etc. to conduct research on cutting-edge technologies and key equipment, and enhance the technological level and competitiveness of energy storage. For example, energy storage enterprises can be supported to cooperate with Shanghai Jiao Tong University, Shanghai Electric Power Institute, Shanghai Energy Storage Technology Association, etc. to carry out research on new materials, technologies, and equipment for energy storage, and improve the performance, efficiency, and lifespan of energy storage.
(2) Accelerate the development and improvement of industry standards for energy storage. This includes standards for the design, construction, operation, maintenance, safety, and environmental protection of energy storage, regulating the market behavior of energy storage, improving the quality assurance of energy storage, and ensuring the safe and reliable operation of energy storage. For example, advanced international and domestic standards can be referenced to develop relevant industrial and commercial energy storage standards suitable for Shanghai, such as technical requirements, quality testing, safety assessment, environmental impact standards for energy storage, unified market access and exit conditions for energy storage, and improved market standardization and trust in energy storage.
(3) Strengthen talent protection. In accordance with the requirements of the "Shanghai Development Method Green Transformation Promotion Regulations" and the "Shanghai Action Plan for Promoting High quality Innovation and Development of New Energy Storage Industry (2023-2025) Draft for Soliciting Opinions" on the introduction and training of green transformation talents, we will strengthen the introduction and training of innovative talents in the energy field, support talents in this field to apply for various talent plans, strengthen talent innovation and entrepreneurship carriers, and enrich flexible means of talent introduction at home and abroad.
4. Improve the settlement mechanism of the industrial and commercial energy storage market, and promote reasonable and compliant settlement of industrial and commercial energy storage
(1) Improve the settlement mechanism for industrial and commercial energy storage. A fair competitive environment is the cornerstone of healthy market development, and a complete settlement mechanism helps to improve investment efficiency, promote fair competition, and ensure compliance in the industrial and commercial energy storage market. It is recommended to refer to the distributed photovoltaic settlement system, where State Grid will install measurement meters uniformly, authoritative third parties will calculate energy storage benefits, and State Grid will synchronize and directly settle electricity bills to ensure the accuracy and consistency of data.
(2) Promoting measures such as reducing transmission and distribution fees and demand fees during the charging period of industrial and commercial energy storage can effectively incentivize the charging of industrial and commercial energy storage during low demand periods, and improve the utilization efficiency of industrial and commercial energy storage. Reduce the operating costs of enterprises and encourage more enterprises to invest and use energy storage technologies.
5. Improve the operation and management of industrial and commercial energy storage, establish a data platform and regulatory system for energy storage
The operation and management of industrial and commercial energy storage should follow the principles of marketization, standardization, and intelligence, establish a data platform and monitoring system for energy storage, achieve real-time monitoring, remote control, data analysis, fault diagnosis and other functions of energy storage, improve the operational efficiency and safety of energy storage, reduce the operation and maintenance costs of energy storage, and extend the service life of energy storage. At the same time, a market trading mechanism for energy storage should be established, allowing industrial and commercial energy storage to independently participate in various trading links in the electricity market, such as electricity trading, electricity price trading, auxiliary services, demand response, etc., providing diversified sources of income for energy storage, increasing the return on investment of energy storage, and promoting the market-oriented development of energy storage. Specifically, the following measures should be taken:
(1) Establish a data platform for energy storage. Collect, store, analyze, and share project information related to energy storage, while monitoring energy storage capacity, charging and discharging capacity, etc. The data is uploaded to the cloud to provide data support for the operation and management of energy storage, and to provide data basis for the optimization and improvement of energy storage.
(2) Establish a sound market trading mechanism for energy storage and formulate market trading rules for energy storage. Provide market support for the operation and management of energy storage, such as the trading subject, trading method, trading price, and trading settlement, and provide market guarantee for the revenue and benefits of energy storage.
(3) Building energy storage infrastructure. In urban planning, the construction of energy storage infrastructure should be comprehensively considered to provide basic guarantees for the development of industrial and commercial energy storage. For example, building large-scale energy storage power stations, charging stations and other facilities to meet the energy needs of industrial and commercial enterprises. Relying on various new energy storage facilities, we encourage the construction of integrated source network load storage and new energy microgrid demonstration projects, and actively promote the safe and reliable replacement of new energy. Meet the demand for new loads, reduce power supply pressure on the power grid, and enhance the support capacity of the new energy grid.
(4) Build a flexible and efficient supporting energy storage system. Accelerate the application of energy storage technology and deeply integrate it with various links such as new energy, power grid, and load, explore diversified technological routes, promote the development of new energy storage from pilot demonstrations to large-scale commercial applications, promote the construction of system friendly "new energy+energy storage" power stations, improve the reliable output level of new energy, and promote the coordinated operation of source network load storage integration. Explore new models and formats for the development of new energy through collaborative operation of energy storage across multiple time scales and technological types.
(5) Provide standard processes for the construction, production, and grid connection of energy storage, and determine the responsible department. Ensure efficient coordination and management of key processes, simplify approval and implementation processes, reduce administrative and operational costs, and accelerate project progress.
(6) Strengthen supervision and regulation, and form a self-contained regulatory system. By establishing a unified regulatory framework and clear division of responsibilities, and establishing strict regulations and norms for the energy storage industry, the safety and reliability of projects can be effectively improved, while providing clear guidance and stable expectations for industry participants to ensure the safety and reliability of energy storage technology. For example, establishing a testing and certification system for energy storage equipment, strengthening the construction and operation management of energy storage projects, and other measures to ensure the healthy development of the energy storage industry.
6. Strengthen the promotion and training of industrial and commercial energy storage, enhance social awareness and market participation in energy storage
The promotion and training of industrial and commercial energy storage are important ways to enhance social awareness and market participation in energy storage. It is necessary to strengthen the promotion and education of energy storage, enhance the public's understanding and recognition of energy storage, and enhance its social influence and attractiveness.
At the same time, it is necessary to strengthen training and guidance on energy storage, enhance the awareness and participation of industrial and commercial users in energy storage, increase market demand and supply of energy storage, and promote the market-oriented development of energy storage.
Furthermore, support the development of user side energy storage. Encourage industrial and commercial users to use new energy storage technologies to reduce peak electricity demand, actively participate in peak load shifting and demand side response, and reduce the electricity load on the power grid.
In addition, it is necessary to strengthen the demonstration and promotion of energy storage, select a group of representative and influential industrial and commercial energy storage projects, display and promote typical cases, form a good atmosphere and demonstration effect of energy storage, and drive more industrial and commercial users to participate in the construction and operation of energy storage.
