China’s natural gas reform: why and how

ABSTRACT

Natural gas is playing an extremely significant role in implementing green and low-carbon economy in China, while its share in energy mix only accounted for 6.4% of China’s total energy consumption in 2016. The Chinese government began to make a series of policies and measures to catalyze natural gas production and consumption for dealing with severe air pollution and optimizing energy structure. Some key issues such as highly regulated natural gas pricing system, the monopoly of natural gas pipelines, and the dominance of state-owned oil companies are substantially existing to be addressed in the forthcoming natural gas reforms. The dilemma of reforms is analyzed in this article and the related reform solutions are to be explored in the deregulation of Chinese natural gas pricing mechanism, separation of state-owned companies’ pipeline, and nondiscriminatory third-party access. The results show that Chinese natural gas reform is destined to be a long-lasting war.

KEYWORDS:

• China’s natural gas
• Chinese natural gas pricing
• natural gas pipeline
• natural gas reform
• state-owned oil companies
• third-party access

Additional information

Funding

This work was supported by the Fundamental Research Funds for the Central Universities (Grant No. 17CX04020B).