Relationship Between Henan Province’s Electricity Price And Economy Development

As a commodity, power resource plays a fundamental role in a country’s economy and affects people’s livelihood. How to determine and adjust the price, it’s not only related to the power companies’ revenue, but more related to people’s life and social economy development. So research on the relationship between the electricity price and the economy development is the major concern all the time. For a long time energy resource’s supply-demand in Henan province is relatively tight, and power price has a low level through all the country, power producers and power grid enterprise are experiencing difficulties in business operation, and have no capability to support the development of downstream industrial enterprises. This paper analyzes the price trend and current energy supply&demand in Henan province, also comprehensively studies the provincial price level from angle of all parties in the industry chain. Secondly, from the practical level, this paper elaborates on the economic structure of Henan Province, analyzes the future economy development forecast, and compares with other provinces. Finally, from the angle of industry classification, on the basis of input-output method and CGE theory, this paper studies and analyzes the comprehensive effect of electricity price level towards the economy development of Henan Province, reveals the synergistic effect of price and the social economy development, and then presents the policy recommendations including increasing the policy support for energy industry, improving the mechanisms of energy prices, accelerating the industry upgrading and transformation, and promoting the healthy and sustainable development for industry chain. The innovation point of this paper is to use input-output method and the CGE model to study and analyze the relationship between electricity price and economy development. In summary, this paper studies the relationship between the electricity price and the economy development, and come to a conclusion about very low power price which is not suitable for economy development, also advise to adjust the power price and accelerate the transformation of the economic development mode. These ones here will play an important reference role in the future determination and adjustment of electricity price, and it will bring good economic benefits for power companies, power users and the whole society.