Study on market mode and pricing model of the green grid electricity market in China
ByY. Hong, W. Wang, D.X. Niu, B.Y. Liu, L.L. Jiang, L.N. Wu & J.P. Liu
Pages 4

The comparison of different electricity price mechanism is illustrated in Table 1.

Each electricity price mechanism has its own characteristics. The government sets prices in Germany’s fixed price mechanism which is compulsory, stable and easy to operate. But the impetus of the market itself is weak. Fixed price mechanism is unfavorable for reducing cost and for ensuring orderly competition and innovation. Britain’s bidding system under the organization of the government has formed a certain competition. It is beneficial for cost reduction but easy to form price-cutting competition and large enterprises’ monopoly. America’s green electricity price mechanism can reflect the true costs of renewable energy power generation. However, this mechanism requires consumers to have higher environmental protection consciousness. Britain’s Renewable Portfolio Standard is mandatory and is beneficial to maintain inter-area fairness (Lin et al. 2013, Langniss et al. 2003).