First steps in power sector reform: the case of China's Guangdong Province

摘要

Governments planning reform of their country's electrical power sector frequently receive recommendations to move in a single step to a market with a compulsory pool and a single buyer. In many developing and emerging economies such a first step is likely to carry an unduly high risk of failure for a range of technical, economic, legal and political factors. This paper arises from a consultancy project in Guangdong Province, China, and proposes a sequence of reform which includes two intermediate steps to be completed before the introduction of a compulsory pool: (1) efficiency improvements and cost reductions with no market and (2) a transition wholesale market.