On August 3rd, China and Europe reached a "price agreement" on photovoltaic (PV) products. Starting from August 6th, most Chinese PV companies no longer face an anti-dumping tax of up to 47.6%, which was previously a major barrier for them to access foreign markets. This development allows Chinese PV firms to retain market presence in certain countries under specific conditions, while also boosting domestic investment and growth in the local PV industry. At the same time, the Chinese government has introduced a series of supportive policies aimed at promoting the solar sector.
Wang Sicheng, a researcher at the National Energy Research Institute under the National Development and Reform Commission, stated that before 2020, the average annual installed capacity of 10-15 GW is achievable. Last year, the market size reached between 100 billion and 150 billion yuan. “Once such a large market gets off to a promising start, it will drive significant growth,†he said. According to reports, the National Energy Administration is planning long-term strategies for the PV industry, aiming for cumulative installed capacity of 35 GW by 2015 and 100 GW by 2020. By 2050, the annual installed capacity could reach 30 GW, which would help eliminate overcapacity and ensure the domestic market can support itself.
According to Wang Sicheng’s calculations, the national subsidies for photovoltaic power generation over the next decade will amount to about 20 billion yuan annually, totaling 200 billion yuan in total. This substantial financial incentive is expected to attract both private and state-owned enterprises into the domestic PV market. However, whether private companies receive equal subsidies and policy support remains a critical factor affecting their investment enthusiasm and competitiveness.
In an interview, Shen Hongwen, a researcher at China Investment Advisors, pointed out that private and state-owned enterprises differ significantly in terms of capital, technology, management, talent, credit, and policy background. As a result, it is challenging for them to compete on equal footing. While relevant policies may benefit the entire industry, the question of whether civilian capital will be treated fairly deserves close attention.
The National Energy Administration recently issued the Interim Measures for the Administration of Distributed Generation, encouraging enterprises, energy service companies, and even individuals to invest in and operate distributed power projects. These projects are eligible for construction subsidies or per-unit generation incentives. The measures cover various renewable sources, including solar, wind, biomass, geothermal, and ocean energy.
One of the main challenges for distributed generation is grid connection. The new regulations require grid companies to provide efficient grid services, including the construction of external grid facilities and investments in public grid upgrades caused by the connection. They must also offer timely and convenient grid access, along with signing grid-connected agreements and electricity purchase contracts.
It is reported that distributed generation is typically self-consumed, with excess power sold back to the grid. Two-way metering or net metering is used, and peak-valley pricing may be considered. Grid companies must prioritize the purchase of surplus electricity generated by these systems.
The new measures have systematically addressed barriers to integrating distributed generation. As a key player in this area, the State Grid Corporation of China has announced new initiatives, including technical support for connecting distributed power sources to the grid. Similarly, China Southern Power Grid has introduced guidelines to support new energy projects, establishing a green channel for small-scale distributed projects connected at 10 kV or below.
Financial support for distributed PV is now unprecedented. Tan Zaixing, Director of the New Energy Assessment Department at the China Development Bank, revealed that the National Energy Administration and the bank are planning to jointly issue documents supporting financial services for distributed PV. These policies are expected to be released early in September.
The new financial support includes roof-mounted installations for industrial and commercial enterprises, universities, and residential buildings. It also extends to individuals, with loan amounts ranging from 50,000 to 500,000 yuan. This makes it easier for ordinary people to participate in the PV market.
Local governments are also rolling out detailed rules for distributed PV, with some regions already enabling household PV systems to connect to the grid. Industry experts believe that financial support for individuals will significantly boost the adoption of distributed solar power.
Shen Hongwen emphasized that for these policies to be effective, there must be clear implementation rules, independent oversight, and strict enforcement mechanisms. At the national level, responsible officials should be identified, and their performance monitored by auditors, media, and the public. Meanwhile, grid connection and subsidy policies need to be implemented gradually and steadily.
Wang Sicheng noted that in addition to national subsidies, provinces can also offer local support based on their financial situations. However, as of now, no province or city has officially launched its own PV subsidy program.
Shen Hongwen also highlighted that local governments are facing financial difficulties, including debt crises and limited banking resources. In such a context, the implementation of PV subsidies has become a serious challenge. Forcing state-owned enterprises to "help out" or issuing local bonds may not be sustainable solutions, as local governments lack strong incentives to actively support these policies.
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