Research On Questions And Countermeasures About The Process Of Heating Industry's Market Transition In Changchun City

Heating System in a certain city isn't only the necessary infrastructure, but also plays an important role on meeting the residents'demands of living in the city. The Heating is that the living and producing heat is supplied by steam and hot water through pipe-nets produced by industrial remains heat, terrestrial heat, nuclear heat, thermoelectricity, electricity station or burning coal. Since the scale and scope economic effects of the heating industry in the city, it has a character of natural monopolization so that it was always only operated by the local government as the social public utility. In this case, the heating enterprises should not only run as firms, but also have to take on some social liabilities for the government resulting in the low efficiency and negative revenue of the most of them. The problem is increasingly prominent between the supply and demand of heat with the improvement of people's living standard. Thus, it's greatly necessary to introduce new managerial and operative mechanism, absorb many more investors and speed the process of heating industry's market transition.The heating industry in Changchun city has developed quickly with the development of economy and construction. And it has played the important roles on promoting the production, managing the environment and ensuring the normal work and living as the vital infrastructure. However, so far, the heating industry in Changchun has been supported by the local government and completely controlled by the administration leading to many problems during the process of the market transition.Firstly, there exists the problem of property right. In the first instance, the principal parts of property right are not clear. The investors and operators of the heating enterprises are both government among above the 50% heating firms in Changchun city. These heating firms have no any property rights including the right of self-governed, and also have no rights of revenue and treatment. They are in the position of having no rights, no responsibilities, and no benefits so that nobody is concerned about the development and operation of them and they don't show any energy. Next, the wrong of the function of heating firm results in, on the one hand, that the local government intervenes the operation of heating enterprises entirely, on the other hand, enterprises act as government agents to offer house, education, medical treatment, welfare and so on for employees. Finally, the amphibious relationship of possession leads to the operative assets are ignored and managed randomly resulting in the negative influence on whole benefits of heating firms. Thus, the status of property right of heating industry in Changchun city violate the market justice not to form the market environment, and restrict the development and competitive ability of heating industry.Secondly, the problems are the heat price and fare. On the one hand, the outstanding problem of the heat price in Changchun city is that there are no any reasonable mechanisms which reflect the linkages between the heat cost and the heat price. It's a regular rule on linking the price and the cost. However, in Changchun city, the heat cost is decided by market and the heat price is decided by government. During these years, the majority of the heating firms are in the bad position of income because of the rising price of raw materials such as coal, gas and electricity, while the heat price is fixed considering the social burden pressure. So it's not helpful for the sustainable and healthy development of heating industry in Changchun city. On the other hand, there are two aspects on the problem of heat fare which are the mechanism of collecting the heat fare and the method of calculating the heat fare. The mechanism of collecting the fare which is units take on or provide the heat free separates the users from payers. The method of calculating the fare which is outcome of welfare system separates the fare from the consumption. These are both away from the objective principle of market economy.Thirdly, it's the problem of investment and financing. There are some characters in the heating industry which are the huge original investment, the long terms of building and return. The heating industry in Changchun city have some the following problems: Number one is that the mail investors are still the governments or the institutions of government. Number two is that the goals are to achieve the social and environmental benefits and not to get the economic benefits. Number three is that the capital which comes from the government occupies the whole heating market and excludes the competition. All of these cause the results of the narrow sources of capital, the bad efficiency of operation and the nonstandard ways of investment and financing.Lastly, there exit the problems of the support of regulations and laws and the system of social security.Combining the theoretical analysis and the practical work, some suggestions and measures are put up.First of all is to reform the system of property right. The heating industry in Changchun city should deepen the administrant system reform of state-owned assets and accelerate to build the system of modern enterprise according to the rules of the unification of management rights and the diversity of the property rights. Above all, the state-owned heat enterprises should absorb the different economic organizations through adding the sources of capital to build up the firm system and establish the limited liability firms or share limited firms under the conditions of the control by state. It will be benefit for posing the scientific and reasonable systems of leadership and organization. Then, the state-owned large and medium heat enterprises in Changchun should be encouraged to operate heat cross areas by sharing, controlling, and annexing. So the assets of heating industry in Changchun city will be flexible and be increased and the efficiency of operating heat will be improved. At the same time, the governance structure should be perfected, the management of firms inside should be strengthened, and the system of management should be improved and a set of mechanisms of inspirit and control should be built up. Last, a set of operative mechanisms which are fit for the requirement of the system of modern enterprise should be found considering the social effect and market effect. The cost control mechanism should also be enhanced so that the heat enterprises will become high effective organizations and corporations depending on the market and operating independently. Next, the systems of establishing heat price and taking heat fare should be reformed. Some measures of establishing heat price are composed of building up new price mechanism, building up the open and transparent systems of establishing heat price and mechanism of adjusting heat price. Furthermore, the old system of taking heat fare by house acreage should be cancelled and the new system should be applied by calculating door by door.Last, the system of investment and financing should be reformed. Social capital which is high effective and flexible should be utilized during the process of market transition in heating industry in Changchun city. And the heat resources should be distributed by market mechanism which will play entirely the basic adjustable function. Many kinds of capital including non-state-owned capital, social capital, and foreign capital and so on should be used by the ways of joint venture or cooperation to invest the development of the heat industry in Changchun city. The diversity structure of investment will be greatly helpful to break monopoly, reduce the cost, improve the operative efficiency and ease the pressure of government finance.