China is working to reduce CO2 emissions from its power system by combining power market reform and carbon pricing. A study simulated power system operations in Southern China under different carbon pricing scenarios. Results show that moderate carbon pricing alone is not enough to reduce emissions; power sector reform is also needed. As carbon prices increase, coal use decreases, with natural gas becoming more prominent. Emissions only significantly decrease at carbon prices above 300 RMB/TCO2. Guangdong province sees the most emission reduction, while other provinces see minimal change. Carbon pricing increases power system costs, even at low prices. Both power sector reform and carbon pricing are necessary for deep emission reductions in Southern China.