With a carbon neutrality goal set to be achieved before 2060, China can be expected to focus more on renewables as solar PV and wind under its upcoming 14th FYP, to ensure achievement of this goal well within time. (Photo Credit: National Energy Administration)
- PV InfoLink believes China’s 14th FYP may encourage 45 GW of annual solar PV installations in the country
- There may not be specific targets under the plan unlike laid out under 13th FYP, but the country is likely to continue to scale up solar and wind power development to increase the share of renewables in electricity generation
- Regulators are expected to look into grid unavailability issues to accommodate growing amount of clean energy in the years ahead to ensure their support to these technologies at a time when the government is pulling back financial incentives
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Even as the global solar PV industry waits with bated breath for the largest PV market in the world to announce its official stance on solar PV technology’s growth under its 14th Five-Year Plan (FYP), PV InfoLink analysts expect annual solar installation additions in China to grow as high as 45 GW in the years ahead.
Currently, China is seeking comments and feedback on the 14th FYP following which an official draft is set to be submitted for review by the end of March 2021 and the plan to be officially unveiled soon after.
The solar PV market intelligence firm believes China won’t have specific targets for solar and wind under the 14th FYP that’s likely to come into effect in H2/2021. It had targets under the ongoing 13th FYP though, with 110 GW for solar and 220 GW of wind deployment between 2015 and 2020.
PV InfoLink anticipates the overall renewables target under the new policy to be raised to 18% to 20% of the total energy mix which bodes well for several tier 1 PV market leaders as LONGi, Tongwei and Aiko, among others.
However, the analysts point out at the ‘hidden threats’ the industry is facing since the Chinese government has made it clear it won’t be subsidizing solar projects except for residential solar. Calculating 20% non-technical expenses to account for 20% of total costs of a project, they believe projects may find it difficult to achieve grid parity without government support. They suggest the regulators to offer guaranteed quota for power consumption and power supply to help deal with grid unavailability issues.
“Given limited room for development of other renewable energy sources or immature technologies, it’s expected that China will continue to scale up the development of solar and wind to increase the share of renewables in electricity generation,” opines PV InfoLink.
In May 2020, there were media reports of the country’s National People’s Congress (NPC) member Cao Renxian having recommended the government to set a target of a minimum 300 GW of new solar PV power generation capacity under the 14th FYP, since till March 2020 the country had already installed 208 GW (see China: 300 GW New Solar Under 14th 5-Year Plan?).
In December 2019, the China National Renewable Energy Centre (CNREC) and the Energy Research Institute of Academy of Macroeconomic Research in the China Renewable Energy Outlook (CREO) 2019 lobbied for 58 GW of an annual solar PV capacity additions target for China under 14th FYP, 116 GW under 15th FYP and 150 GW under 16th FYP, all for the Asian giant to ensure a green transition by leveraging cost reductions of solar PV (see China Must Scale Up RE Installations Pace: CREO 2019).
All said and done, it does look like China may be forced to take solar PV, rather renewables more seriously than ever since its Premier Xi Jinping declared that his country will aim to achieve carbon neutrality before 2060 though a detailed roadmap is yet to come in officially (see China Declares Carbon Neutrality Goal By 2060).