Recently, the Hunan Regulatory Office of the National Energy Administration, together with the Hunan Provincial Development and Reform Commission and the Hunan Provincial Energy Bureau, issued the *Trading Rules for Hunan Province's Power Auxiliary Service Market (2023 Edition)* (hereinafter referred to as the "Trading Rules").
In 2020, the Hunan Regulatory Office of the National Energy Administration issued the *Trial Trading Rules for Hunan Province's Power Auxiliary Service Market* (Xiang Jian Neng Shi Chang 〔2020〕 No. 81), launching Hunan's auxiliary service market. From 2020 to 2022, the market operated well on the whole and achieved remarkable results.
After the issuance of the trial version of the rules, in November 2021, the 22nd Meeting of the Central Committee for Deepening Overall Reform pointed out that it is necessary to improve the multi-level unified power market system, promote the construction of power market mechanisms adapted to energy structure transformation, promote the formation of a diversified competitive power market pattern, and give play to the supporting role of the power market in the clean and low-carbon transformation of energy. In December 2021, the National Energy Administration issued the *Measures for the Administration of Power Auxiliary Services* (Guo Neng Fa Jian Guan Gui 〔2021〕 No. 61), putting forward the work idea of "four news". To implement the requirements of the national power market reform, improve the quality and efficiency of Hunan's power auxiliary service market transactions, and ensure the safe, stable, high-quality and economic operation of Hunan's power grid, the Hunan Regulatory Office of the National Energy Administration, together with the Hunan Provincial Development and Reform Commission and the Hunan Provincial Energy Bureau, after careful research and extensive solicitation of opinions, revised the *Trading Rules* focusing on the scope of participating entities, the sharing mechanism of compensation fees, and other contents.
The *Trading Rules* have been improved in the following aspects:
1. Integrating newly added contents such as the *Trial Rules for Load-Side Adjustable Resources to Participate in Hunan's Power Auxiliary Service Market*. On May 29, 2022, Hunan launched the trial operation of load-side adjustable resources participating in Hunan's power auxiliary service market, achieving a new breakthrough in load-side adjustable resources participating in power grid peak regulation. This revision of the rules integrates the relevant provisions of the *Trial Rules for Load-Side Adjustable Resources to Participate in Hunan's Power Auxiliary Service Market*.
2. Expanding the scope of buyers and sellers in the power auxiliary service market. Small and medium-sized power generation entities with an installed capacity of 10 MW and above in the province that meet the measurement conditions are included as buyers of power auxiliary services. New sellers of peak regulation transactions are added. In accordance with the *Implementation Rules for the Administration of Auxiliary Services of Grid-Connected Power Plants in Central China Region* and combined with the construction schedule of gas-fired unit projects in the province, gas-fired units are added as sellers of start-stop peak regulation transactions. At the same time, considering policy guidance, self-owned power plants are included in the scope of sellers of peak regulation auxiliary services to fully tap their peak regulation potential.
3. Connecting with the regional power auxiliary service market. In accordance with the *Operating Rules for Inter-Provincial Power Peak Regulation and Standby Auxiliary Service Market in Central China* issued by the Central China Energy Regulatory Bureau on September 30, 2022, to effectively connect with the Central China regional auxiliary service market, the principle is clarified that peak regulation resources in the province should first meet the peak regulation needs of the provincial power grid, and the surplus capacity can participate in inter-provincial peak regulation auxiliary service transactions.
4. Optimizing the way energy storage participates in deep peak regulation transactions. To adapt to the development trend of rapid growth of energy storage scale and stimulate the competitive vitality of energy storage in participating in the auxiliary service market, access conditions for energy storage to participate in auxiliary services are set, two modes of sequential call and priority call are optimized, and energy storage power stations are allowed to choose the participation mode independently.
5. Revising the price limit for start-stop peak regulation transactions. Small and medium-sized thermal power plants have different unit characteristics and different start-stop costs. To ensure that the capacity division fully covers all units, reasonably determine the start-stop peak regulation compensation, and encourage small and medium-sized power plants to participate in start-stop peak regulation; with reference to the *Implementation Rules for the Administration of Auxiliary Services of Grid-Connected Power Plants in Central China Region*, fixed compensation is set for the start-stop peak regulation of gas-fired units.
6. Optimizing and adjusting the sharing coefficient. To reasonably control the total scale of auxiliary service fees and avoid excessive sharing burdens on various market entities, the market service fee adjustment coefficient and sharing coefficient are re-determined through scientific and repeated calculations.
Source: Market Supervision Department of Hunan Energy Regulatory Office
For details, please refer to the annex: *Trading Rules for Hunan Province's Power Auxiliary Service Market (2023 Edition)
