China’s NEA outlines a plan for construction of unsubsidized PV and Wind projects

70 MW floating PV system in China constructed by Ciel & Terre

China’s National Energy Administration (NEA) released a consultation paper outlining the »Work Plan for the Construction of Unsubsidized (Grid-Parity) Projects for Wind & Solar PV«. According to the consultancy Asia Europe Clean Energy (Solar) Advisory Co. Ltd. (AECEA), »priority is explicitly given to the construction of unsubsidized projects.« A number of unsubsidized solar PV power generation projects that can start construction in 2019 should be confirmed first, before any project requiring or applying for subsidies shall be confirmed.
A related policy released early January 2019 announced to strictly implement both power transmission and consumption for such unsubsidized projects; furthermore, to encourage solar PV power generation projects approved in 2018 or prior years to be converted into unsubsidized projects. »In the event and projects agrees to voluntarily convert to an unsubsidized project, grid companies shall earmark such power consumption as the highest priority level,« explained AECEA’ Director Frank Haugwitz. »Moreover, new unsubsidized projects constructed in 2019 are subject to a second priority level. On the contrary, after the consumption of the unsubsidized project is guaranteed, projects require state subsidies shall be considered last.«
Solar PV power projects that have been approved for two years, but have not started construction or have not applied for extension, or have applied for extension but have not started construction within the extended period, regardless of whether the company promises to continue construction, the project approval will be abolished, says AECEA. According to Frank Haugwitz, currently PV projects that are approved, but not constructed (with quota) amounts to more than 7.8 GW and PV projects which are approved, but not constructed (without quota) totals to more than 32 GW.
NEA is considering the introduction of a nationwide centralized bidding process for projects seeking subsidies in the next months. Furthermore, NEA intends to have finalized their intended policy for green electricity certificates at the end of June.
The consultancy expects, that the Chinese solar PV market will evolve from a previously solely subsidy-driven to a market home to both grid-parity and FIT supported projects and eventually entering a subsidy-free market period beginning 2021.

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