Market design and operational experience with generation and transmission of the three-gorges hydroelectric power station

The world largest hydropower station, Three Gorges, is faced with changing process of the electricity industry in China when the traditional province-based electricity monopolies are broken in a move to create six regional competitive power markets since it starts supplying electricity to three of the regions in 2003. Because of very serious electricity shortage in southern and eastern China the transmission routes for Three Gorges have been also very congested in the summer peak periods. The paper presents how the congestion management is made in the market environment under fairly coordination with some security standards. The paper shows that the market-oriented pricing principles have been proven to be adequate in the changing process of regional markets. Some key aspects of commercial and technical agreements are also mentioned in this paper to describe how the effective utilization of hydro electricity has been realized in the market environment and congested transmission routes in summer peak period