Russian Market and Generator Market Analysis

Nov 15 ,2022 Site Editor

With Russia set to become the World Trade Organization's 156th member, a whole new market is opening. As one of the "BRICS" emerging markets and the world's only major economy outside the WTO, Russia's tariffs will be significantly reduced after joining the WTO. After joining the WTO, Russia's overall tariff level will be reduced by about 3.5% compared with the current level, with the weighted average rate to be reduced to 7.6% in 2013, 6.9% in 2014 and about 6% in 2015. This is no doubt a big temptation for Wenzhou's manufacturing industry, which is famous for its light and low-voltage electrical industries.

 

Wenzhou exports hit a cold winter

Wenzhou Customs reported that in the first six months of this year, the total value of Wenzhou's foreign trade was 8.32 billion US dollars, up only 2.1% from the same period last year. This is a sharp contrast to the previous year's 30% growth momentum, and far below the national total export growth rate of 8.7%. Wenzhou Customs provided data for July, the value of foreign trade exports was $1.75 billion, down 9 percent year on year; From January to July, the total value of Wenzhou's foreign trade exports was USD 10.06 billion, which decreased by 0.1% year-on-year. Wenzhou export suffered a cold winter not seen in many years.

 

The data also showed that in the first half of this year, the trade volume between Wenzhou enterprises and the EU was 2.26 billion US dollars, decreasing by 11.19% year on year. Its trade with the US was 1.248 billion US dollars, up 16.39% year on year; Trade with ASEAN reached US $751 million, up 8.96% year on year; Trade with Russia was $644 million, up 12 percent year on year. The only economies exceeding double digits were the United States and Russia.

 

Grey clearance changed

In the view of professionals, there is still a long way to go to completely say goodbye to "gray customs clearance".

Wei Tao, marketing director of the London-listed Global Market Group, an international e-commerce platform dedicated to promoting high-quality "made in China" worldwide, said in a telephone interview that it is too optimistic to expect the WTO to solve the "grey customs clearance" immediately due to the complex historical background, interest chain and regional differences in Russia. He estimates it will be five years before the problem is resolved.

Because the European debt crisis can not be solved in the short term, the blow to the middlemen is relatively big, including Wenzhou, the export to the European Union has shown a shrinking situation, Russia is a good emerging market. It is suggested that Wenzhou enterprises interested in exporting to Russia should be familiar with local policies and regulations, set up legal enterprises in Russia as soon as possible, and hire local workers, and find more reliable channels, rather than do the traditional border trade thinking to do the Russian market.

 

Trade between China and Russia

In 2001, the trade volume between China and Russia exceeded $10 billion. From 2001 to 2008, the trade volume between the two countries experienced a period of rapid development. In 2008, the trade volume exceeded $50 billion. But it fell sharply in 2009, to $39 billion, because of the economic crisis. Since then, bilateral trade has recovered rapidly. According to Chinese customs statistics, the value of China's exports to Russia increased by 31.4 percent in 2011, making Russia the country with the highest growth rate among China's major exporters.

Total trade between China and Russia rose 24.4 per cent in the first five months of this year. For Russia, China is the largest trading partner, and for China, Russia moved up from 10th to 8th place last year. Among China's top 10 trading partners, trade with Russia is growing the fastest. Almost half of China's exports to Russia are mechanical and electrical products, and the rest are mainly clothes and toys.

 

Generator low-voltage electrical field

At present, the power generated by large generating units in the Russian electricity market is sold in the wholesale market, and large industrial users, retailers and suppliers of guarantee buy power in the wholesale market. Retailers and guarantee suppliers sell electricity purchased in the wholesale market to end-power users in the retail market. In the Russian power market, generators with an installed scale of more than 25MW can only participate in the wholesale power market trading. Power generation units with installed capacity between 5 and 25MW can choose to participate in the wholesale market or retail market. Small generating units with an installed capacity of less than 5MW can only be traded in the retail market.

Russia has a vast area and a large gap in power grid construction. Based on the existence of competitive electricity market, the Russian electricity market can be divided into price region and non-price region. Due to technical limitations such as the transmission grid structure of the region, the price area is further divided into the first price area and the second price area. The first price area is composed of the federal main body of the more developed European region and the Urals Region, and the second price area is formed by the Siberian region. The non-price zone consists of parts of the unified federal grid and independent grid areas. In price areas, electricity prices are basically determined by competitive market behaviors, except for electricity consumption for people's livelihood. In the non-price region, due to the relatively backward construction of the power grid and the undiversified power generation structure, the conditions for developing a competitive power market are not yet available. Government supervision is still dominant, and the electricity price is basically verified by the Federal tax Bureau in accordance with the legal formula. Under normal circumstances, the power grid operation between price zone and non-price zone is relatively independent, and the electricity cannot be traded across regions.

 

1. Wholesale market

Russian electricity wholesale market can be divided into electricity wholesale market and capacity wholesale market according to the different attributes of the commodities traded. In order to ensure that the price of public utility electricity, such as residential electricity, is within a reasonable range, both markets include regulated markets. Russia introduced the capacity market in order to avoid under-investment in the power industry and promote investment in new power stations. The capacity market is based on the forecast of future power demand, mainly including the capacity bidding market for short term capacity demand bidding and medium - and long-term capacity supply contracts.

 

1.1 Wholesale market of electric energy

The electricity wholesale market is mainly composed of day-ahead market and day-balanced market, and only a small amount of electricity is traded through bilateral market.

 

1.1.1 Bilateral trading market

Russia introduced bilateral trading markets in 2001. The contracts can be signed by power generators, electricity sellers and large users. The types of trading include long-term forward trading or futures trading, and short-term bilateral trading for the next day. In addition to the freely priced part of the bilateral trading market, there is also the part regulated by the government. Since the wholesale market was re-established in 2007, the volume of electricity traded through competitive markets has increased year by year. By 2011, the regulated bilateral market only supplied electricity to residential users and end suppliers in the North Caucasus and the Republic of Tuva at a price determined by the Federal tax agency FST on a cost-plus-certain basis.

 
1.1.2 Day-ahead electricity market

ATS and SO cooperate with each other in the electricity market. Before the DAM market starts, SO and ATS will first make the optimal selection of unit combination according to the information provided by the generator set, such as technical parameters, generation plan and maximum generation quotation. Only the selected generator set can participate in the bidding process of the DAM market. Before the DAM trading market is closed, the generator set and the electricity selling company or the large industrial user respectively provide ATS with the next day's hourly electricity generation and electricity quotation. Based on the above information, SO and ATS adopt the node marginal price model to optimize the node price and transaction electricity of about 8500 nodes in the power system. The LMP model takes into account the marginal cost of generator set, network loss and line blocking. The results of today's electricity market bidding, including hourly rates and trading volumes, will be published on the ATS website.

 

1.1.3 Daytime balance market

Bilateral trading market and day-ahead electricity market are power generation and electricity consumption plans based on forecast. However, there are inevitable deviations between the actual operation of the power system and the forecast, and the balance market is required to maintain the supply and demand balance of the system.

In the balanced market, SO organizes bidding 12 times a day. The generator set and the user (with adjustable load) can submit the quotation information of the change of the output and electricity consumption plan to SO 90 minutes before the actual operation. Based on the quotation information and the ultra-short-term load prediction results, SO adopts the same LMP calculation model as the day-ahead market. Calculate the price and transaction power in BM market. In order to encourage the generators and users to execute the generation plan as much as possible, the balanced market will punish the units or users that cause the deviation due to their own reasons. For example, the generation price of the overgenerated generating units is the minimum value of the balanced market and the quoted price in the day-ahead market.

 

1.2 Capacity wholesale market

Russia's wholesale capacity market is also mainly composed of the regulated part and the competitive part of the market. Market competition is mainly reflected in the capacity bidding market, and the regulated part is mainly reflected in the government capacity subsidies for new generating units or forced operation of generating units.

 

1.2.1 Capacity bidding market

The capacity bidding market is the basis of Russia's wholesale capacity market. It is organized annually by the System Dispatching Agency (SO). Before the bidding starts, SO will publish the predicted monthly peak electricity demand and other relevant information in the capacity trading year on its official website. According to the above information, the generator will submit the quotation strategy to SO 10 working days in advance, including the monthly capacity and price, the parameters of the generator set, the access point of the generator set and the start date (for units not in production). Before 2016, the bidding process took place a year ahead of schedule; In 2015, the Russian Federation Act No.839 amended the relevant rules of CCS. Starting from 2016, SO will start capacity bidding 4 years in advance. Based on the bidding price of the power station and the principle of lowest cost, SO gives priority to the unit with the lower quotation. The winning generator set must be able to respond to the instructions of the system dispatching organization at any time during the actual capacity trading period to increase or reduce the unit output, otherwise it will be punished to some extent. Generator sets not selected by CCS can still participate in the day ahead, balance and other electric energy trading markets. Russia's CCS bidding and clearing principle is shown in Figure 5. The upper and lower limits Pmax and Pmin of the capacity price are set in the Russian capacity bidding market, and the elastic range Dmin ~ Dmax of the capacity demand is set according to the capacity demand forecast. The intersection point C of line segment AC and capacity quotation curve represents the market clearing price and capacity. As can be seen from the above, the buyer does not directly participate in the bidding in the capacity market, which is an imperfect competitive market in which only the seller participates. All capacity costs generated by the system will be shared equally by the users according to their peak electricity demand in proportion.

 
1.2.2 Regulated capacity market

Although the generator sets participating in CCS can obtain certain subsidies, the income from CCS is not enough to subsidize the investment cost and operation cost of new power stations. To boost investment in new power stations, Russia has introduced capacity supply agreements since 2010. Investors in new power stations can obtain certain investment subsidies from the government for new power stations by signing capacity supply agreements with the government and power system regulators, so as to ensure that the investment in power stations has a benchmark rate of return of 12%-14%. The capacity subsidy is paid monthly, and the specific amount of the subsidy is determined by the trading platform (ATS) according to the national legal method (for conventional generating units, it is calculated by the Act No.238 promulgated in 2010; Wind power, photovoltaic and small hydropower are calculated according to Act No.449 enacted in 2013). New thermal power stations will be subsidized for 10 years, while new hydropower and nuclear power stations will be subsidized for 20 years. Investors will have to ensure that new plants come on stream within the promised timeframe or face steep financial penalties.

In order to promote the development of renewable energy, Russia passed the No.449 Act supporting renewable energy in 2013. By signing the Renewable Energy Capacity Supply Agreement (RES-CDA), investors receive a 15-year capacity subsidy from the government, which guarantees a benchmark return of 12 per cent. This subsidy policy will be further introduced and analyzed in detail below.

In addition, in the Russian power system, in order to maintain the stability and reliability of the system, part of the generating units must be forced to operate, such as the thermal power units and heating power units near the load center. These forced operation units (MSG) are usually old generating units with relatively high power generation cost. In the process of CCS, due to the high price, they will not be selected. For the above-mentioned generating units that must be operated by force, the Russian government provides a separate capacity subsidy. The subsidy price is approved by the Federal Tax Bureau once a year, and the subsidy price is higher than the CCS market clearing price.

In order to ensure adequate supply of power to the power system, these units, which receive government capacity subsidies, will be preferred by default in the CCS market.

 

2. Retail market

On the basis of the original regional power companies, the Russian electricity sales side has reorganized and set up various forms of electricity sales market participants. The Russian electricity sales market is mainly divided into the following categories: power users, power sales companies/power suppliers, guaranteed suppliers (SLR), small power producers (installed capacity of 25MW or less), and regional distribution companies. As the final consumers of electric energy, residential, industrial and commercial users can freely choose the electricity selling company/power supplier, and the electricity selling company/power supplier can also freely choose users and provide corresponding services. Underguarantee suppliers provide underguarantee power supply services in the area where they are located. In addition to free selection of users, they must also ensure the power supply to residents in the area. The regional power distribution company is responsible for maintaining the secure operation of the power distribution network, providing power distribution and access services for local users, and delivering power directly to users. Regional distribution companies also act as buyers in the sales market, buying power from power suppliers or small generators to make up for network transmission losses.

 

Generator with low-voltage switch ATS

Based on the huge power generation market in Russia, the dual power switch supporting the generator has a huge potential. The local Russian enterprises do not have enough research and development capacity for the dual power switch, and have been using the big brand ATS. In addition, the withdrawal of Schneider, ABB, Eaton and other electric brands from the Russian electric market. This is a good opportunity for Chinese ATS manufacturers. The need for generators, coupled with the current instability of Russian electricity, will increase the demand for ATS.

ATS dual power Automatic switch, is the abbreviation of automatic transfer switching equipment. ATS is mainly used in the emergency power supply system. It is a switch device that automatically switches the load circuit from one power supply to another (standby) power supply to ensure the continuous and reliable operation of the load. Therefore, ATS is often used in important places of electricity, and its product reliability is particularly important. Once the conversion fails, it will form one of the following two hazards, short circuit or important load power failure between the power sources.

16A-32A自动转换开关PC级自动转换开关

Generators (Generators) are mechanical devices that convert other forms of energy into electrical energy. They are driven by a water turbine, steam turbine, diesel engine or other power machinery and convert energy generated by water flow, air flow, fuel quenching or nuclear fission into mechanical energy that is passed to a generator, which is converted into electrical energy. Generators are widely used in industrial and agricultural consumption, national defense, science and technology and daily life.

There are many ways in which generators work, but they are all based on the law of electromagnetic induction and the law of electromagnetic force. Therefore, the common criterion of its structure is: with appropriate magnetic and conductive data to form a magnetic circuit and circuit to stop electromagnetic induction, in order to generate electromagnetic power, to achieve the purpose of energy conversion.

Our One two three Electric Co., Ltd. is China's ATS switch leader enterprise, is the leader of low voltage electric. The R&D and production of dual power supply has been firmly in the forefront of China. Our other low-voltage electrical switches, such as plastic-case circuit breaker, mini-circuit breaker, frame circuit breaker, isolation switch, control and protection switch and other stable quality, welcome to ask.

 

 

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