Case In Huaihua To Analysis The Possibility On Market And Legal Measures About Power Industry In China

Associated with the development of the theory of natural monopoly, people’s understanding of the natural monopoly industries is also deepening. The traditional natural monopoly theory take scale effect as the theoretical basis of natural monopoly. Since the seventies of last century, the natural monopoly theory has a new development, cost subadditivity of the proposed concepts provide a new tool for people to rediscover the natural monopoly industries. Together with the original government dignitary protection under natural monopoly industry, a lot of proplems appared: the efficiency is low, the cost is high and service is bad, etc. It can not adapt to the needs of people. Therefore, reforming the traditional monopoly industries and introducing competition and implying market-oriented operation has become a trend. It can provide more efficient use of market forces to provide better products and better services. With China’s economic development, the association between power industries and the states has been growing, the power sector reforms are being carried out steadily through exploration.China’s power industry that under reforming is still not perfect, far from the market, the competition of the request. Competitive electricity market should be able to provide market signals for power investment, the Government’s medium-term objective of reform is to introduce competition in the generation side to increase economic efficiency.Huaihua, located in a remote, economically underdeveloped place. But the electricity market in Huaihua did very well, as opposed to domestic or other parts of the province, Huaihua relatively low price, service level is relatively good. And Huaihua Power has two companies on the market, National Grid and local grid companies, not only did not die in the competition, but growing more and more powerfull, Huaihua experience to China’s power market as following: 1, Open competition; 2, Allow competition under the rules of free market between state-owned enterprises; 3, Practice on a competitive basis; 4, Separate administrative functions from enterprise management.Based on the analysis of The Huaihua market and abide with the advanced foreign experience, this paper bring up that our country ought to think about it from a legal point of view. Improve the regulatory approach in the power industry, restrain the unfair competition and other monopolistic restrict competition and abuse of market position between power companies to drive the behavior of power market.