Renewable Energy Growth Is Driving a New Phase of Power Grid Development

As China continues to adjust its energy mix, the rapid expansion of wind and solar power is transforming the structure and operation of its electricity system. Traditional power networks, largely designed around centralised generation and one-way electricity transmission, are evolving toward more flexible systems that accommodate diverse energy sources, bidirectional power flows, and coordinated regulation across multiple levels.

In 2026, China identified New-type Power Grids as one of six major infrastructure networks requiring stronger planning and development. The initiative aims to improve energy resource allocation, support renewable energy integration, and strengthen the security and reliability of electricity supplies.

The development of New-type Power Grids involves more than expanding transmission lines and substation capacity. It requires a comprehensive upgrade of the power system’s transmission, distribution, regulation, protection, and operational capabilities.

1. Renewable Energy Integration Creates New Challenges for Grid Operation

Wind and solar power output varies with weather conditions and other natural factors. As their share of electricity generation increases, power systems must coordinate generation, transmission, energy storage, and electricity demand with greater precision.

First, renewable energy resources and electricity demand are not always located in the same regions. Cross-regional transmission and interconnected power networks are therefore essential for improving resource allocation and delivering electricity from major renewable energy bases to demand centres.

Second, the growing adoption of distributed photovoltaic systems, energy storage, electric vehicles, and flexible industrial loads is changing the role of distribution networks. These networks are increasingly required to accommodate multiple sources of electricity and support more dynamic interactions between the grid and end users.

Third, greater variability in generation and demand increases the importance of system flexibility, real-time monitoring, and coordinated dispatch.

Against this background, new-type power grid development is focusing on three key priorities:

• Strengthening the transmission capacity of backbone grids and facilitating cross-regional electricity exchange.
• Upgrading distribution networks to accommodate distributed generation, energy storage, and evolving load patterns.
• Improving flexible regulation through energy storage, intelligent dispatch, and coordinated operation among generation, grid, load, and storage resources.

These developments are essential to maintaining a balance between renewable energy utilisation, operational efficiency, and electricity supply security.

2. Coordinated Development of Transmission Grids, Distribution Networks and Microgrids

New-type Power Grids rely on the complementary functions of different network levels. Each plays a distinct role in supporting a more flexible and interconnected electricity system.

• Transmission Grids: Enabling Cross-Regional Electricity Allocation

High-voltage and ultra-high-voltage transmission infrastructure helps transfer electricity over long distances, connect major generation bases with demand centres, and facilitate electricity exchanges between regions.

• Distribution Networks: Accommodating Distributed Energy Resources

Network upgrades, equipment renewal, and intelligent monitoring can improve the ability of distribution systems to accommodate distributed solar generation, energy storage, and changing electricity demand while maintaining supply quality and reliability.

• Intelligent Microgrids: Improving Local Energy Management

By integrating distributed generation, storage, control systems, and local loads, microgrids can support coordinated energy management and, where appropriately designed, operate either in grid-connected mode or independently.

The coordinated development of these three levels can improve the overall flexibility of the electricity system, from long-distance power transmission to local distribution and energy management.

As more distributed resources enter the power system, coordination among transmission grids, distribution networks, and microgrids will become increasingly important.

3. Coordinating Generation, Grid, Load and Storage

The integration of generation, grid, load, and storage, commonly referred to as source-grid-load-storage coordination, is an important approach to improving electricity system flexibility.

This approach coordinates electricity generation, transmission and distribution, consumption, and energy storage to improve the balance between power supply and demand.

For example, when renewable energy output is high and local consumption is insufficient, energy storage, demand-side flexibility, and electricity transmission to other regions may help improve renewable energy utilisation. During peak demand or periods of reduced renewable generation, storage and other flexible resources may help support the balance between supply and demand, subject to system conditions and operational requirements.

Digital technologies provide additional tools for coordination. Intelligent sensing, data analysis, and optimisation algorithms can help grid operators monitor equipment conditions, identify load variations, and make more informed dispatch decisions.

Virtual power plants offer another approach by aggregating distributed generation, energy storage, and controllable loads, allowing these resources to participate in electricity system management where appropriate technical and market arrangements are in place.

However, the effectiveness of these solutions depends on grid conditions, control capabilities, market mechanisms, and applicable safety requirements. Software and algorithms alone are not sufficient; reliable electrical equipment and effective protection and control systems remain fundamental.

4. Higher Standards for Electrical Equipment

As grid structures and operating conditions evolve, electrical equipment must meet increasingly diverse technical requirements.

Safety and reliability remain fundamental. Equipment must satisfy the relevant insulation, thermal stability, electrodynamic withstand, and short-circuit performance requirements applicable to its intended operating conditions.

Application flexibility is also becoming more important. Transmission expansion, distribution network upgrades, energy storage integration, and renewable energy projects involve different voltage levels, capacity requirements, environmental conditions, and system configurations.

Meanwhile, the digitalisation of power systems is increasing the importance of equipment condition monitoring, operational data collection, and maintenance management. Equipment selection therefore needs to consider not only rated parameters, but also actual operating conditions, system compatibility, installation requirements, and lifecycle performance.

For electrical equipment suppliers, a detailed understanding of application scenarios, continued product improvement, and effective technical cooperation with engineering and system integration partners can help address these evolving requirements.

5. Technological Innovation for a More Reliable Power System

New-type power grid development is a comprehensive undertaking involving generation, transmission, distribution, energy storage, electricity demand, and control systems.

As renewable energy integration expands, grid development will increasingly focus on balancing transmission capacity, system flexibility, distribution network capability, and operational security.

Key technologies such as ultra-high-voltage transmission and grid-forming energy storage have attracted attention as part of China’s efforts to strengthen power system capabilities. Their application must be supported by appropriate equipment design, system-level engineering, and operational validation.

For the electrical equipment industry, this creates a continuing need to improve reliability, adaptability, and compatibility with increasingly complex power system configurations.

Conclusion

New-type Power Grids are a critical foundation for China’s energy transition and modern infrastructure development. As coordination among transmission grids, distribution networks, and microgrids deepens, and as source-grid-load-storage integration and digital technologies advance, the ability of electrical equipment to meet specific application requirements and operate reliably within integrated systems will become increasingly important.

DKNC will continue to follow developments in new power systems, transmission and distribution technologies, and electrical equipment applications, supporting industry awareness of emerging technologies and evolving technical requirements.

Sources:

National Development and Reform Commission, National Data Administration, Xinhua News Agency, CCTV.