Page 35 - A Comprehensive Guide to Solar Energy Systems

Chapter 2 • Solar Power Development in China 29

power systems, respectively. The tariff for concentrated PV ranged in rMB yuan 0.90–1.0
−1
(kW h) depending on the regional condition in solar resources. Meanwhile, distributed
PV (e.g., rooftop PV) was allowed a pattern of “self-generation self-use and surplus feed in
−1
grid”; the tariff employed for electricity feed to grid was rMB yuan 0.42 (kW h) plus the
local feed-in benchmark price for coal-fired electricity. The coal-fired electricity prices at
−1
the time were in a range of rMB yuan 0.35–0.45 (kW h) , so the subsided price of distrib-
−1
uted PV was rMB 0.7–0.8 yuan (kW h) .
The FiT scheme for PV power, since its adoption in 2013, has strongly driven the devel-
opment of the domestic PV market. Meanwhile, due to the low returns on investment,
coupled with lack of transparency in electricity dispatching and other operations directly
related to PV power (for instance, cash flows and capital transferring), the domestic dis-
tributed PV market was inactive. Here, distributed PV refers to electricity that is produced
at or near the point where it is used. To turn the status around, in September 2014 NEA
adjusted the policy for distributed PV systems, allowing the owners to choose between a
self-consumption pattern and a pure feed-in pattern, with limited possibilities to switch
the remuneration pattern during the system lifetime. The pure feed-in model applied to
the feed-in benchmark price for utility-scale PV, while the other model applied to the sub-
sided price for distributed PV.
The FiT scheme for PV has been entirely financed by the revenue from the ESrE. NDrC
has successively twice lowered the feed-in price for concentrated utility-scale PV while
−1
keeping the subsidy of 0.42 yuan (kW h) for distributed PV unchanged. Currently, FiT for
−1
concentrated PV has dropped to a level of rMB yuan 0.65–0.85 (kW h) (Table 2.6). Hence,
the prices for distributed PV and concentrated PV are roughly equal; moreover, the price
differences between solar resource regions increased from the initial rMB yuan 0.05 (kW
−1
−1
h) to 0.10 (kW h) . These changes in FiT scheme were obviously more favorable for dis-
tributed PV, and were intend to curb the growth of traditional grid-connected PV systems
in the Northern and Western regions and boost the development of distributed PV in other
regions.

Table 2.6 2017 Updated FiT Schedule for PV Generation (RMB yuan (kW h) )
−1 a
Concentrated and “All Feed-to-Grid” Distributed Distributed b
Solar Region FiT Self-Consumed Feed-to-Grid Surplus
I 0.65 Retail price +0.42 On-grid coal-fired price
II 0.75 +0.42
III 0.85
The prices include tax breaks. RMB 1 yuan = EURs 0.136.
a The schedule was published at the end of 2016 and put into effect on January 1, 2017.
b According to the stipulations by NEA and the State Grid, the distributed PV refers to (1) the power source that is connected to 35
kV-grade grid (or integrated to 10 kV-grade grid, with the on-grid capacity no larger than 6 MW), while the proportion of self-use
electricity is more than 50%; (2) the power source that is connected to l0 kV-below grid, with the on-grid capacity no larger than
6 MW.
Source: Author’s compilation based on NDRC. Notification on adjustment of PV power and onshore wind power feed-in benchmark
price (no. 2729). NDRC; 2016 [15].