• NDRC of China has come out with a guidance of FIT payment levels it has planned for solar power projects in the country with effect from July 1, 2019
  • This list is not absolute, and final payment levels will be decided basis auction results
  • Payment levels have been worked out under three separate regions, however for village level poverty alleviation projects, FIT levels remain the same, according to Mercom
  • AECEA says it doesn’t specify the fate of 28 GW to 30 GW of solar capacity that came online between July 1, 2018 and June 30, 2019, however it expects installation rush in last 2 quarters of 2019 as government finalizes the list of eligible projects

In the latest development from China’s government regarding its solar market policy, the country’s National Development and Reform Commission (NDRC) has released the long-awaited levels of feed-in-tariff (FIT) payments for utility scale solar projects. These rates are a mere guidance and not absolute since the level will be decided through an auction procedure. It will be applicable from July 1, 2019.

According to Mercom India Research, solar FIT payments that are inclusive of all taxes will be made region wise. Utility scale projects in region 1 will get RMB 0.40 ($0.059) per kWh; for region 2 , theFIT is RMB 0.45 ($0.067) per kWh; and for region 3 the level is RMB 0.55 ($0.082) per kWh.

Poverty alleviation solar PV projects at ‘village-level’ will continue to receive FITs of RMB 0.65 ($0.097) per kWh for region 1; RMB 0.75 ($0.11) per kWh for region 2; and RMB 0.85 ($0.13) per kWh for region 3.

For commercial and industrial distributed generation solar projects that use power for self-consumption and feed excess back to the grid can expect FITs of RMB 0.10 ($0.015) per kWh. Residential solar power systems working on the same model or with 100% feed-in will be eligible for RMB 0.18 ($0.027) per kWh.

Mercom also refers to the communication released consultancy Asia Europe Clean Energy (Solar) Advisory Co. Ltd. (AECEA) where its Director Frank Haugwitz emphasised that the notice by NDRC doesn’t specify what the government will do for PV systems connected to the grid between July 1, 2018 and June 30, 2019, adding up to around 28 GW to 30 GW. AECEA expects the government to address this and other related issues until the end of June 2019. But till then, expect installation rush between 3rd and 4th quarters of 2019 as Beijing releases the list of projects eligible for FIT support during the year.

After pulling back state financial support for utility scale solar projects in May 2018, in January 2019 China said it will provide subsidies to new solar and wind power projects but with certain boundary conditions (see Beijing Announces Solar Support Measures).

In April 2019, the National Energy Administration (NEA) of China confirmed RMB 3 billion ($448 million) subsidy for solar in 2019 while issuing draft rules for development of subsidy-free, grid parity solar PV and wind power projects (see China Issues Draft Policy For Solar/Wind Projects).