China’s National Development and Reform Commission (NDRC), the Ministry of Finance (MOF) and the National Energy Administration (NEA) jointly released its official ≫2018 Solar PV Power Generation Notice≪. According to consultancy Asia Europe Clean Energy (Solar) Advisory Co. Ltd. (AECEA), DG projects are subject to a cap of 10 GW in 2018. ≫All DG projects which managed to achieve grid connection until May 31st, will be eligible to enjoy FITs granted by the central government.≪ DG projects which are not recognized by the central government shall seek financial support from respective local governments. AECEA estimates, that approximately 9 GW of DG projects were installed between January and April 2018 (plus approximately 2 GW of utility-scale) and ≫highly likely by the end of May, the 10 GW cap has already been realized.≪
Furthermore, FITs were uniformly reduced by CNY 0.05/kWh ($0.007) and the on-grid tariffs for resource zone 1, 2, and 3 were adjusted to CNY 0.5 / 0.6 / 0.7 per kilowatthour, respectively. The next FIT reduction is anticipated to be between 12 to 15 percent effective Jan 1, 2019, says ACEA director Frank Haugwitz.
Last year, NEA announced a 13.9 GW utility-scale project target for 2018. However, the latest NEA notice stipulates that this target has been abolished and has instructed provinces to stop projects seeking 2018 FITs in any form. ACEA: ≫Support of utility-scale projects in future is subject to further notice.≪ Subsidies for village-type poverty alleviation projects (up to 0.5 MW) remained unchanged and are for resource zone 1, 2, and 3; CNY 0.65 / 0.75 / 0.85 per kilowatt-hour, respectively.
In AECEA’s view 2018 is a transition year for the Chinese PV Market. The consultancy has not only lowered its forecast for 2018 from 40 to 45 GW to 30 to 35 GW, but as well lowered its forecast for the remaining years of the 13th Five-Year-Plan period (2016-2020) to 20 to 25 GW annually. According to solar energy consultant Frank Haugwitz, at the end of 2020, ≫China could be home to approximately 200 to 215 GW of total installed solar PV power generation capacity which would be in line with a 200 GW target, although not officially confirmed, however proposed by China’s National RE Development Center in the context of China’s Renewable Energy Roadmap in November 2017.≪