Restructuring an electricity sector entails a complex realignment of political and economic institutions, which may both delay and distort the achievement of market conditions that are reasonably competitive. In research and planning for policy interventions in power systems under these varied regulatory environments, typical operational models may neglect important areas in which engineering constraints and political realities combining together can substantially change outcomes, leading to poor understanding of underlying causes of inefficiency and to inappropriate recommendations. We develop tractable formulations of a common power systems model used on a daily basis--the unit commitment optimization--which consider important political factors in the Northeast grid region of China. We demonstrate the importance of these interactions on operations and provide a set of options for researchers to explore further pathways for China's ongoing power system reforms. For example, wind integration, a key policy priority, is inhibited by the interaction of institutions limiting short- and long-term sources of flexibilities in inter-provincial trade.