North China Northeastern China Northwestern China Germany US Spain 0 10 20 30

North China Northeastern China Northwestern China Germany US Spain 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Solar Wind Hydro Nuclear Gas Coal

Challenge III: Heat-driven Operation of Combined Heat and Power (CHP) Units National Average 25% North China 50% Northeast China 70% Heat demand distribution The share of CHP in thermal units • Must-run units in heating season • Possible range of power output decreases with the increase of heat demand • Heat demand is predetermined by heating companies • Typically range between 70%- 90% of the nameplate capacity in heating season. Limited Flexibility of CHP

- 14 - Deregulatio n (2003) Deregulatio n (2003) Five generation groups Five generation groups Two grid companies Two grid companies Challenge IV: Rigid Regulatory Structure

National Dispatch Center （ 1 ） Regional （ 5 ） Provincial （ 26 ） Municipal （ 309 ） County （ 1702 ） Challenge IV: Rigid Regulatory Structure Annual/monthly inter-regional transmission plan and dispatch of major units (e.g. Three Gorges Dam) Annual/monthly inter-provincial transmission plan Provincial energy balance and operational dispatch

Ultra-high voltage super grid State Grid: in 2015 DC:800KV DC:1100KV AC:1000KV

Deployment of pumped hydro storage

Potential Cost Effective Solutions Electric Vehicles Integration with Heating System Interregional Transmission Coordination

Opportunities for Increasing Wind Integration and Reduci ng Emissions 1. Strategy of Coordinated Interregional Transmission : • Northeastern region (2020) Shaanxi 2. Energy System Integration between Power and Heating Systems : • Beijing-Tianjin-Tangshan (“Jing-Jin- Tang”) region (2015) 3. Influence of EV Development on Wind Integration : • Beijing area (2020) • Hourly simulation model considering characteristics of individual units • Annual assessment of economics

Opportunities for Increasing Wind Integration and Reducing E missions 1. Strategy of Coordinated Interregional Transmission : • Northeastern region (2020) Shaanxi 2. Energy System Integration between Power and Heating Systems : • Beijing-Tianjin-Tangshan (“Jing-Jin- Tang”) region (2015) 3. Influence of EV Development on Wind Integration : • Beijing area (2020) • Hourly simulation model considering characteristics of individual units • Annual assessment of economics

How to Coordinate Interprovincial Transmission?  Four possible strategies in 2020 : ◦ A) BAU: to determine the interprovincial transmission on an nual and monthly basis ; ◦ B) Taking advantage of the interprovincial available transmis sion capacity, sharing reserve among different regions; ◦ C) Allowing daily scheduling of interprovincial transmission, but keep reserve requirement within the province; ◦ D) Optimizing both transmission and reserve on a regional g rid. EIM HLJ JL LN