China to Let Power Prices Turn Negative in Solar-Rich Province
- Shandong province has a large amount of rooftop solar
- Negative prices encourage generators to halt production
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Power traders in China’s Shandong province can now ask to be paid for taking electricity as the province’s growing rooftop solar capacity threatens to overwhelm the grid.
The province officially set the lowest price on its spot market below zero, according to a draft rule released by Shandong Development and Reform Commission. Negative prices that encourage generators to switch off are typically seen on more advanced electricity exchanges in the US, Germany, and Australia and suggest another step forward in China’s slow march toward liberalizing its power sector.