June 7, 2013
Translated by Zhu Na

National Development and Reform Commission (NDRC) revealed yesterday that it will begin a gradual overhaul of the country's electricity pricing system.

According to the current rules, the price of electricity is dependent on what it is used for. The plan is to gradually reduce the existing eight categories to three: residential, agriculture production and "commercial and other use". After the new system is established, the NDRC also plans to expand the scope of what counts as agricultural production.

The NDRC said that the new pricing system could reduce the power bills of schools, social welfare units and companies in the agriculture forestry, animal husbandry and fishing industry by around 3 billion yuan a year.

The existing pricing system is quite complicated. There are eight basic categories: residential, non-residential lighting, commercial, non-industrial, general industry, major industry, agricultural production and an eighth "other" category. Prices will differ depending on which category a customer is said to belong to and also the voltage and grade.

Generally, the price of electricty used for commercial purposes is higher than agricultural and residential prices.

The notice clearly states that electricity used by public facilities in urban and rural residential areas, schools (including the dormitories of students and teachers), social welfare offices and neighbourhood committee facilities should all be considered as residential use and priced accordingly.  

Currently schools and social welfare offices in Beijing pay 0.22 yuan a unit more than the basic residential electricty price of 0.4883 yuan a unit. This means that after the adjustment, their power bills should fall.

According to the way companies are classified at the moment, some fishery and animal husbandry firms are not considered agricultural producers and are thus sold electricity at the higher commercial rates. The new rules will broaden the scope of what is considered agricultural production and will therefore lower power costs for some of these companies.

Despite the NDRC revealing they issued a notice about the price reforms, when the Beijing News called the Beijing Electric Power Company (北京电力公司) yesterday, their customer service staff said they were yet to receive any such notice.

Links and Sources
Beijing News: 电价结构调整 全国每年省30亿