China Promoting Subsidy-Free Renewables

China Promoting Subsidy-Free RenewablesChina Promoting Subsidy-Free Renewables

China will give priority to the construction of wind and solar projects that can operate without subsidies this year, and will cap new subsidized capacity, the energy regulator said, part of efforts to ease a subsidy payment backlog.
After a rapid fall in manufacturing costs, China has been gradually cutting the amount of subsidies to renewable energy providers, Reuters reported. 
It said last year that it would take action to ensure wind and solar generators can achieve “grid price parity” with traditional energy sources such as coal. 
China has already promised to launch a series of solar and wind projects that can provide electricity at the same price as coal-fired power, after a surge in capacity left the finance ministry with a subsidy payment backlog of at least $17.9 billion. 
After studying local conditions, regional energy bureaus should give priority to the construction of wind and solar plants with grid price parity, and rationally control the scale of new projects that still require subsidy, China’s National Energy Administration said in new draft rules. 
“Projects that require government subsidy will have to compete with each other on prices ... Government payment will prioritize the projects that are expected to become subsidy-free in the near term,” the draft plan said. 
The NEA plans to improve the management of solar power subsidy by imposing differential policies for large solar stations, distributed solar projects, solar plants designed to help alleviate poverty and government-led pilot schemes. 
Total subsidies for solar projects in 2019 have been set at $430 million. Of that, $110 million will be allocated to “distributed” rooftop power projects with a combined capacity of 3.5 gigawatts, with the rest going to solar stations, the NEA said. 
China added 20.59 GW of wind capacity in 2018, bringing the country’s total to 184 GW, according to NEA data. It remains shy of its 2020 target of 210 GW. 

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