China Delivers Crushing Blow To Wind and Solar Power
China will stop subsidizing new solar farm projects, distributed solar projects for commercial users, and onshore wind farms as soon as this year, Reuters reported, citing the central planning authority of the country.
The change will enter into effect on August 1 and is a departure from the course set late last year. The country’s finance ministry had previously committed to granting 57 percent more subsidies to solar power projects this year, although it did slash subsidies for wind power.
China is a lesson in progress on using subsidies to support the more extensive deployment of renewable power capacity. For years, Beijing has been pretty generous with these installations, spurring a renewables push that turned it into the country with the greatest solar and wind capacity.
Then, in 2018, China dropped a bomb on renewables investors.
“A joint statement put out on Friday by the National Development and Reform Commission, Ministry of Finance and National Energy Administration said the allocation of quotas for new projects had been halted until further notice, and tariffs on electricity generated from clean energy will be lowered by 0.05 yuan per kilowatt hour, a cut of 6.7 to 9 per cent depending on the region, effective June 1,” the South China Morning Post wrote in 2018.
The news sent solar stocks reeling and the industry in a frenzy. The motivation behind the cut was that Beijing wanted to ensure the local solar industry was sustainable in the original sense of the word over the long term.
Yet the reasons for the cut—and this year’s end of subsidies—were not exactly altruistic. China has amassed a massive debt pile in subsidies owed to wind and solar companies as a result of its previously generous support for new projects. The pile, according to a Bloomberg report from July last year, is worth about $42 billion.
See more here: oilprice.com
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very old white guy
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Interesting word “renewables”, as nothing is renewable without fossil fuels.
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Tom
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For sure and for certain. Let’s see them “renew” a 20 year old windmill and 30 year old solar panels…both headed for the junkyard.
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Tom
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Maybe this is China’s lame attempt to balance the books for letting CoV-2 on the loose. Good to see renewables get a thumbs down.
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Jerry Krause
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Hi Guys and PSI Readers,
“China will stop subsidizing new solar farm projects, distributed solar projects for commercial users, and onshore wind farms as soon as this year, Reuters reported, citing the central planning authority of the country.”
A question: Will this, it done, force other nations to return back to fossil fuel fired and nuclear power plants in the future.???
Have a good day, Jerry
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JaKo
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Hi Jerry,
It may be just a coincidence, but I just read of Chinese progress in nuclear synthesis lately and if a Yuan spent on that will yield higher return than from this half-dead solar and wind BS, so be it…
Cheers, JaKo
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