Significance of demand response in light of current pilot projects in China and devising a problem solution for future advancements

The electric power sector significantly contributes to China's economic growth. However, rapid industrialization and urbanization have led to energy shortage problems. More than 70% of customers' demand is fulfilled by fossil fuel sources that threaten the environment. The rapid increase in demand and the need for decarbonization has forced China to work on demand-side management (DSM) to fulfill the power needs of the country. DSM is receiving much importance in China over the past few years. However, it is still in the early phases of development in comparison to other developed countries. At first, this paper points out the need for demand response, which is an aspect of the DSM, for maintaining power system stability and integrating variable renewable energy resources such as wind (on-shore and off-shore) and solar (photovoltaic and concentrated solar power). Then, it assesses China's power sector reforms and changes in demand response policies over the period to promote demand response programs. It also reviews the current demand response pilot projects in China, identifies technical and policy barriers in implementing these projects and proposes recommendations to make it successful across the whole country.