Too many chefs make it difficult to implement reforms

The National Energy Administration and State Electricity Regulatory Commission recently signaled that private enterprises are welcome to participate in energy and electricity investments, says an article in the 21st Century Bussiness Herald.

Their actions are a response to the State Council's suggestion earlier this month that private enterprises are encouraged to participate in energy development fields.

Yet, the question is whether these signals can be translated into real actions under the current administration system in the field of energy.

The administration system in the energy field is quite complicated. The prices and investment policies are settled by the National Reform and Development Commission. The National Energy Administration, which is affiliated to the NRDC, is mainly responsible for macro research in the energy field and its administrative rank is lower than the three big State-owned oil enterprises.

The NRDC is in charge of supervising power prices, making investment policies and evaluating the feasibility of projects in the field of electricity. But the assets of electricity enterprises are all managed by the State-owned Asset Supervision and Administration Commission of the State Council. The Ministry of Finance is responsible for supervising the electricity enterprises' financial conditions. The State Electricity Regulatory Commission supervises the security and production quality of electricity enterprises, provides suggestions on power prices and decides who is allowed to run electricity businesses.

There are so many authorities in the energy fields. No single decision is likely to change the position among private enterprises, if there is no agreement among all relevant parties.

Too many chefs in this field of strategic importance make it very difficult to implement reforms with coordinated actions and foresights.

No wonder many people argue that China should establish a ministry to supervise these issues in the energy field, with centralized powers to better coordinate policies and management. It is the very first step in removing the barriers in the administration of the energy field.

Translated by Li Yang