National Energy Administration
(June 24, 2016)
1. Background and Importance of the Action of Internet Plus Smart Energy
Internet Plus Smart Energy is a new form of energy industry with deep fusion of the Internet and energy production, transmission, storage, consumption and market. Its main characteristics include equipment being smart, multiple energy types being synergy, information being symmetric, supply and demand being distributed, system being flat, and transactions being open. This new form of energy industry is commonly called the “Energy Internet” in the energy and information industries in China.
The State Council takes great importance of innovative development of energy industry represented by the Energy Internet. Premier Li Keqiang has emphasized many times that the energy supply and security matter to China’s economic and society development, promote Internet Plus, bring deep fusion of the Internet and the energy industry, advance smart energy development, increase level of green, low carbon and smartness of energy, proceed a path of clean, highly efficient, secure and sustainable development of energy, and support sustainable and healthy development of economy and society. “The Guiding Opinions of the State Council on Actively Promoting the Action of ‘Internet Plus’” (Guo Fa [2015] No. 40) states that vigorously carry out actions of Internet Plus Smart Energy, advance flatness of energy system management through the Internet, promote energy production and consumption revolutions, and promote optimization of energy utilization structure.
The Energy Internet will bring significant opportunities to the energy industry, mainly as follows: Firstly, it will boost the development of clean and low carbon energy especially distributed renewable energy. Secondly, it is crucial for the advancement of smart energy technologies and equipment, is important to implement Made in China 2025 in the energy sector, and is a favorable direction of “Going out” of China’s technology standards. Thirdly, pilot and demonstration projects of the Energy Internet will provide important breakthrough points and test fields for the energy system reform.
2. General Ideas of China’s Energy Internet Development
The general ideas of China’s Energy Internet development are:
Firstly, infrastructure openness and public participation. Exert the fundamental role of the Internet in the energy industry reforming. Promote the rational opening of energy infrastructure. Accelerate the fusion of energy production and consumption. Enhance the public participation level. Accelerate the formation of an open and shared new form of the energy industry.
Secondly, exploration and innovation, and demonstration first. Follow the law of application and development of Internet Plus. Create an open and inclusive innovation environment. Encourage diversified innovation of technologies, mechanisms and business models. Promote pilots and demonstrations of new technologies and business models of the Energy Internet according to local conditions. Form welcome atmosphere of masses innovation.
Thirdly, market driven and scientific supervision. Exert the decisive role of the market in resource allocation, and drive to a new ecosystem of the Energy Internet. Adapting to the new ecosystem and the development requirement of big data applications, improve the supervision mechanisms of safety and market under the condition of deep fusion of energy and information, and safeguard information security and legitimate rights of market participants.
Fourthly, deepen reform and promote revolution. Adapt to the development requirement of the Energy Internet that technology contributes thirty percent whereas reform contributes seventy percent. Deepen the energy reform of system and mechanisms. Restore the commodity attribute of energy. Build effectively competitive market structures and market systems. Promote energy consumption, supply and technology revolutions.
3. Milestones of China’s Energy Internet Development
The Energy Internet is a new form of energy industry, and related technologies, business models and ecosystems are at an exploratory development stage. In order to ensure healthy and orderly development of the Energy Internet, two stages are planned in short- and mid-terms. i.e. launch pilots and demonstrations firstly and launch generalization and application afterwards, so as to ensure substantial results.
From 2016 to 2018, promote pilots and demonstrations of the Energy Internet: Build a batch of pilot and demonstration projects with different types and sizes. Make breakthroughs in a batch of key technologies and core equipment, and the Energy Internet technologies achieve to the international advanced level. Establish preliminary market mechanisms and systems of the Energy Internet. Build a preliminary technology standard system of the Energy Internet, and establish a batch of key technology specifications and standards. Incubate a batch of business models such as energy finance, third-party energy services, etc. Cultivate a batch of competitive emerging market players. Explore a batch of sustainable and replicable development models. Accumulate a batch of important experiences in reform pilots.
From 2019 to 2025, promote diverse and scale development of the Energy Internet: Establish a preliminary industrial system of the Energy Internet, which becomes an important driving force for economic growth. Build relatively complete market mechanisms and systems of the Energy Internet. Form a relatively integral system of technologies and standards, and promote its internationalization, so as to lead the Energy Internet development in the world. Form an open and shared ecosystem of the Energy Internet. The comprehensive efficiency of energy improves remarkably. The renewable energy penetration increases significantly. The clean and efficient utilization of fossil fuel energy makes active progress. The public participation level increases remarkably. Strongly support the energy production and consumption revolutions.
4. Key Tasks of China’s Energy Internet Development
1) Make energy infrastructure smart. For example, develop smart energy production and consumption facilities including smart coal mines, smart wind farms, smart PV stations, etc. as well as Internet-based smart operation cloud platforms, so as to realize remote control optimization and improve operation efficiency and benefit.
2) Construct synergic multi-energy microgrids. In different size areas including large buildings, parks, islands, towns, etc. especially new districts, construct synergic multi-energy microgrids that are based on smart electric grid, interconnected with supply grids of heat and gas, and traffic network, so as to improve overall efficiency and benefit of the energy system.
3) Promote deep fusion of energy and information infrastructure. Coordinate the construction of energy grids including electric, gas, etc. and their information infrastructure including information architecture, storage unit, etc. Advance high efficient integration of information system and energy system in measurement, computation, control, etc. Standardize network structure and information interface. Promote remote automatic collection and reading of water, gas, heat and electricity, and all-in-one meters.
4) Incubate open and shared market system. Support small and micro users such as individuals, families, distributed energy resources to share and trade energy flexibly and equally through Internet platforms. Cultivate emerging market players such as electric retailers, integrated energy operators, etc. Develop business models including B2B, B2C, C2B, C2C and O2O based on the Internet.
5) Develop smart energy usage. Through development of terminal facilities including smart homes, smart districts, etc., build user energy efficiency monitor platform, provide personalized energy efficiency management and energy saving service, and realize smart customization and flexible transaction of energy.
6) E-commerce of distributed renewable energy. Develop e-commerce of distributed renewable energy. Support distributed renewable energy providers including wind, solar, etc. to perform p2p direct transaction with users and settle subsidy in real time.
7) Develop Internet-based operation of energy storage and electric vehicle. Build cloud platforms of distributed energy storage equipment and cloud platforms of electric vehicle operation. Develop value-added services based on energy storages such as emergency backup, peak shaving, and frequency regulation. Develop smart charge/discharge business of electric vehicles, and participate energy transaction and demand response.
8) Develop energy big data application services. Extend collection scope of energy big data, and gradually cover the energy sector including electric, coal, oil, gas, etc. as well as other sectors including meteorology, economy, transportation, etc. Promote innovation and entrepreneurship based on energy big data, and develop new business applications and value-added services facing the energy value chain including energy production, transportation, consumption, etc.
9) Breakthrough key technologies and equipment. Accelerate research and development of core technologies including the Energy Internet system planning, the demand side response and interaction, the energy storage application management, etc. Breakthrough as quickly as possible technology and equipment bottlenecks on the multi-energy coordinated control, the cyber-physical fusion, the energy router, etc.
10) Build a technology standard system. Build a unified, standardized and open technology standard system. Take precedence to form general standards, cross industry common standards. Actively promote key standards to become international standards.
5. Main Policy Measures to Promote the Construction of the Energy Internet at Current Stage in China
1) Establish coordination mechanism. In the mechanism of ministerial joint meeting for the “Internet Plus” action, the National Energy Administration cooperates with relevant departments to establish special coordination mechanism of “Internet Plus” Smart Energy, to coordinate and solve major issues, and push forward the implementation of the action effectively.
2) Increase effective investment. Involve the Energy Internet into the major project package. Increase the investment from both national and local budgets. Guide more non-governmental capitals to participate. Organize the implementation of major demonstration projects of the Energy Internet step by step.
3) Promote market reform. Establish and improve the energy market access system. Encourage third-party capitals, small and micro businesses and other emerging market players to participate in the market. Promote all types of enterprises to develop equally and collaboratively. Accelerate the construction of market system of the electric, oil and gas industries. Establish market-oriented mechanisms for both trading and pricing.
4) Launch pilots and demonstrations. Encourage all qualified areas, departments and enterprises to develop and implement different types of pilots and demonstrations according to their regional and business needs. Build a platform for tracking, monitoring and coordinating service. Establish mechanisms for expert consulting and advising services. Evaluate and summarize the development effectiveness in time.
5) Promote Data Sharing. Carry out national big data strategy in the energy sector. Achieve integrated fusion, sharing and trading services of the energy big data from multiple sectors. Encourage cooperation of Internet companies and energy companies. Promote application innovation of the Energy Internet. Strengthen the safety supervision of energy big data in accordance with laws and regulations.
6) Support Technology Innovation. Establish an Energy Internet industry and innovation alliance. Support the construction of Energy Internet technology innovation platform. Promote the seamless integration of industries, universities, research institutes, and users. Include the key technologies of the Energy Internet as the National Science and Technology Program in the specially supported areas.