Operating Elements of UK Electricity Contract Market and Its Enlightenment to China

Abstract The United Kingdom is the birthplace of the world industrial revolution. Its marketization of the power industry has been going on for more than 20 years. It is a developed country with a relatively mature power market system. The UK electricity market reform has experienced the Power P00L model, the New Electricity Trading Arrangements model, and the British Electricity Trading and Transmission Arrangements model. Since the NETA model, the UK has formed a power production-transaction-regulatory system centered on bilateral transactions. China is undergoing market-oriented reform of the power system. In order to break the monopoly, the main contents include changes in the development concept of the traditional power industry, the establishment of a new mechanism for direct trading between power generation enterprises and users, the establishment of an independent and reasonable transmission and distribution mechanism, and the opening of private capital into the electricity market, and so on. This paper introduces the reform process of the UK electricity contract market, summarizes the substantive elements and mechanism elements, lists the operation elements of the current UK electricity contract market, and analyses the structure of the UK electricity market and the bilateral electricity trading mechanism deeply. On this basis, some suggestions are put forward to further improve the construction of China’s electricity market.