In a recent event, the China-US Smart Grid Dialogue was held in Shenzhen, organized by the China National Energy Administration, the U.S. Federal Energy Regulatory Commission, and the U.S. Trade Development Agency. The meeting aimed to implement the "Memorandum of Understanding" signed between the two nations during the fourth round of the China-US Strategic and Economic Dialogue. The dialogue focused on defining the Chinese smart grid, setting development priorities, and addressing key challenges.
Zhao Yinong, Director of the Integrated Division at the National Energy Administration's Power Division, outlined five core characteristics of a smart grid: openness, security, efficiency, cleanliness, and self-healing. Openness allows for intelligent power management, accommodating both large-scale and distributed energy sources, including renewables. Security ensures the grid can withstand natural disasters, cyberattacks, and other disruptions. Efficiency involves real-time monitoring, demand-side management, and optimized grid operations. Cleanliness supports the integration of wind and solar energy, while self-healing enables automatic fault detection and recovery to prevent blackouts.
Wu Yun, Deputy Director of the State Power Planning Research Center, noted that the National Energy Administration’s definition differs from previous ones. In the near term, China’s smart grid will focus on integrating new energy sources like wind, solar, micro-grids, electric vehicles, and storage systems. It will also leverage information technology to modernize the power grid.
Experts predict that widespread implementation of smart grids could significantly boost related industries such as transformers, smart terminals, and network management, potentially contributing 1-2 percentage points annually to economic growth. Companies like Ke Lu Electronics, GE, and China Putian have expressed optimism about market opportunities.
Despite government clarity on many issues, the timeline for smart grid development remains uncertain. Wu Yun highlighted technical challenges, particularly in energy storage and complex data processing. Current energy storage technologies, like pumped hydro and lithium batteries, face high costs, limited lifespans, and environmental concerns. Additionally, online simulation tools for power systems are still evolving.
A senior expert, who wished to remain anonymous, pointed out that institutional barriers—such as electricity pricing and regulatory control—pose major obstacles. The National Energy Administration is now focusing on developing a rational framework for smart grid growth.
During the 12th Five-Year Plan, the administration plans to launch pilot projects, including establishing an information database, identifying 21 smart grid pilots, researching application scopes and standards, and exploring economic models for investment and recovery.
While the path forward remains uncertain, the government’s commitment signals a gradual but steady shift toward a smarter, more efficient power system. With ongoing policy development, experts remain cautiously optimistic about the future of smart grids in China.
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