Deregulation, Competition, and Market Integration

In the area of institutional development, the promulgation of the Electricity Act in 1995 was a hallmark. [...] In addition, NEC reaffirmed the reform of the electricity sector, particularly by introducing the direct purchase and sale of electricity between generators and large consumers. [...] The invisible hand of the market forces plays no role in price setting nor in affecting supply and demand; 3) Although the country’s grid networks are interconnected, the capacity and efficiency of long distance transmission of electricity is still constrained. [...] This is the same constraint seen in the wind and solar power production in Inner Mongolia, where the lack of smart grids hindered the utilisation of the existing facilities recently. [...] This is 15 largely due to the monopoly of the grid companies and the highly regulated nature of the entire sector.