National Energy Administration of Republic of China recently issues the notice regarding the development of PV demonstration projects for distributed power generation (Announcement  Number 296). An official list of first-batch distributed PV demonstration projects has been released. There are total eighteen projects, taking place in seven provinces and five cities.
The construction timeframe for the eighteen demonstration projects begins from 2013 to 2015 totaling 1.823GW, among which 749MW plans to be completed in 2013 while the rest will be finished before 2015.
The distributed PV demonstration projects are operated by the following modes – power generation for their own use, net metering, and grid adjustment. Subsidies are given out according to the amount of power generated. The subsidy for the distributed PV power generation is RMB0.42/kWh. In addition to the subsidy coming from the desulfurization policy and local government, it boosts the grid power price to more than RMB1/kWh in many regions. While the price of the industrial and commercial power in certain regions is RMB0.7-0.9/kWh, there can be more than 10% gain in the price difference.
The eighteen demonstration projects are constructed in PV provinces and economically developed coastal areas: Beijing Zhongguancun Haidian, Beijing Shunyi, Shanghai Songjiang, Wuqing, Hebei Gaobeidian, Baoding Yingli, Wuxi, Jiangsu Nantong, Shaoxing Zhejiang, Hangzhou Zhejiang, Hefei, Jiangxi Xinyu Hi-tech Zone, High-tech Zone in Shandong Fengan, Shandong Zibo High-tech Zone, Guangdong Sanshui Industrial Park, Guangdong Conghua Pearl Industrial Park, Shenzhen, and Ningbo Hangzhou Bay New Area.
There are four parts that constitute China’s PV subsidy plans which are distributed PV subsidy, CDB’s financial support policies, Benchmark price of four resource areas, and critical policies related to SAT rebate and land properties. After the release of the demonstration projects, the subsidy plans are likely to be released as well.
Certain people worry that there will be more demonstration projects coming out in the future, and the key still lies on financial and local subsidies. The former determines whether the project owner can start the construction this year while the later determines how valuable the project is.
CDB New Energy Assessment Division Director, Mr. Tan, announced on August 16th that National Energy Administration and CDB both have showed their supports toward distributed PV financial service and it’s estimated that they will issue 《Financial service opinion in promoting distributed PV market》in the beginning of September.
After the release of the policies, the support will be expanded from previous large-scale systems to power companies, distributed PV projects and people.