The research focuses on the potential impact and policy implication for fossil- fuel- based power generation under the current market- oriented reform. This research integrates the widely used international definitions with Chinese practice, and thus concludes three types of de facto FFS (fossil fuel subsidy) resulted by the EGP (Electricity Generation Planning): 1) the "on-grid output" based environmental subsidy; 2) the profit from "squeezing out" renewables under the EGP system; 3) the price premium gained through "on-grid benchmarking price" system supported by the EGP. The subsidy for coal-fired electricity in this report refers to the institutional protection rather than the commonly defined FFS. In the year 2016, coal-based electricity has benefited 355.7 billion yuan from the EGP and its supporting policy. To break down this figure, 119.4 billion yuan comes from the environmental subsidies rewarded to desulfurization, denitrification, and ultra-low emission technology, 17.1 billion yuan are from the "squeezing out" the renewables, and 169.2 billion for the "on-grid benchmarking price" system. We believe that the deregulation of EGP could significantly reduce these de facto subsidies to 26.4-30.2 billion yuan. 

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