China’s National Development and Reform Commission (NDRC) has proposed revised rules for electricity spot markets, introducing explicit provisions allowing renewable energy projects and their on-site battery storage systems to participate in spot trading as joint bidding entities.

The draft Basic Rules for Electricity Spot Markets, released on October 19, aims to strengthen the framework for China’s emerging unified national electricity market. It would replace the interim rules introduced in 2023, with implementation proposed for January 1, 2027, and a five-year validity period. Public comments are open until November 18.

A key provision, Article 8, supports renewable energy facilities and their co-located energy storage systems participating jointly in market bidding, clearing, dispatch, settlement and performance assessment.

Under the proposed arrangement, a solar or wind power plant could coordinate generation forecasts and battery charging and discharging schedules when submitting bids, rather than necessarily separating the generation and storage assets as different market participants.

This could allow operators to adjust the timing of electricity deliveries in response to spot price signals, shifting output toward higher-priced periods where technically and commercially feasible. Storage could also help manage deviations between forecast and actual renewable generation, potentially reducing imbalance-related costs.

China’s 2023 interim rules already recognized energy storage, distributed generation and virtual power plants as eligible market participants. The new draft goes further by explicitly supporting joint participation by renewable plants and their on-site storage across the market operating process.

However, like many others from central government, the proposed national rules do not specify detailed bidding formats, metering arrangements, battery charging restrictions or settlement calculations for such combined operations. These would require further clarification through regional and provincial implementation rules.

In addition, this formalizes what was previously active in some provinces already, such as Shandong. The NDRC also officially promoted this kind of mechanism in 2025; however, this time the new rules are pushing the joint bidding to the national-level for the universal electricity market.

The draft also broadens the definition of new market participants to explicitly include new-type energy storage, virtual power plants, load aggregators, smart microgrids and green electricity direct-connection projects. It calls for these resources to participate more fully in market competition and respond to real-time electricity prices.

Beyond renewable energy and storage, the revised framework covers interprovincial, regional and provincial electricity spot markets. It specifies day-ahead, intraday, and real-time trading arrangements, with real-time markets setting dispatch schedules for the next 5 to 15 minutes.

The proposal establishes locational marginal pricing as the preferred market-clearing approach, intended to reflect both electricity supply-demand conditions and transmission constraints. It also calls for stronger coordination between spot trading, medium- and long-term electricity contracts and ancillary service markets, including the gradual introduction of joint clearing for frequency regulation, reserves and ramping services.

For settlements, the draft adopts a daily clearing and monthly billing framework and promotes a transition toward price-difference settlement in regional and provincial markets. It also strengthens requirements for market information disclosure, technical system verification and intervention procedures during abnormal market conditions.

The proposed revisions follow China’s 2025 electricity pricing reform, which required renewable electricity generation to enter the power market in principle and have its price determined through market transactions. The new provisions would provide a clearer path for co-located storage to participate alongside renewable generation.

For solar and wind developers, joint bidding could significantly increase the operational and commercial value of on-site batteries by integrating storage dispatch with electricity trading.