China to cut subsidies for renewable power by 30 per cent to US$807 million in 2020
- Funds will go to wind farms, biomass power generators, distributed solar power operators and solar power projects for poverty alleviation purposes
- China has been scaling back subsidies to renewable power providers because of a decline in manufacturing costs
China will cut its subsidies for renewable power by 30 per cent in 2020 to 5.67 billion yuan (US$806.8 million) from 8.1 billion yuan this year, the Ministry of Finance said on Wednesday, as the country will soon stop funding large solar power stations.
Because of a decline in manufacturing costs, China has been scaling back the amount of subsidies to renewable power providers, which are expected to compete with coal-fired utilities and achieve “grid price parity”.
The funding for next year will be allocated to wind farms, biomass power generators and distributed solar power operators, as well as solar power projects for poverty alleviation purposes, in 11 regions across the country, the ministry said.
The subsidies for solar projects are set at 2.63 billion yuan, while wind farms will receive 2.97 billion yuan and biomass generators will get 73.39 million yuan, it said.
The amount of new installed solar capacity was 16 gigawatts in the first three quarters of this year, the National Environmental Administration has reported.
New solar installations in 2019 will be as much as 25GW, down from 41GW last year, due to easing subsidies on centralised solar projects, an industry executive said in September.
China also plans to end subsidies for new onshore wind power projects at the start of 2021.
Surging renewable power capacity in the recent years has left the finance ministry with a subsidy payment backlog of at least 120 billion yuan and endangered the cash flow of renewable power operators.
