Demystifying China''s Photovoltaic Solar Power Subsidies in 2024
Let''s unpack the current photovoltaic subsidy landscape - it''s like watching a high-stakes solar-powered marathon where provincial governments sprint to outshine each other.
In 2020, the Ministry of Finance of the People's Republic of China slashed the solar energy subsidy budget down to 1.5 billion yuan ($233 million) from 3 billion yuan in 2019. With the auction-based system, companies are to submit subsidies bids for solar power construction projects to the National Energy Administration.
Government subsidies for solar power have also been attributed to over construction, as many solar power projects have been funded by the Chinese government but are curtailed (they do not operate at full capacity) due to the inability to transfer the full energy capacity from production sites.
In 2020, 67% of solar PV modules globally were made in China. 51 China accounts for a similarly large share of global PV cell and polysilicon production. 52 In 2021, solar power was 13% of China's power capacity and produced roughly 4% of China's electricity. 53
In response to the growing problems of the rapidly expanding solar power market and the need to meet promised subsidies, the National Development and Reform Commission announced in May 2018 that solar power subsidies would be slashed and feed-in tariffs would be significantly reduced in favor of an auction-based system.
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