Page 7 - AsiaElec Week 43 2021

AsiaElec TARIFFS AsiaElec

Beijing liberalises

renewables tariffs

CHINA CHINA has liberalised its solar tariff rules in a capping and quasi-suspension of investment
bid to boost investment in renewables in order in both the solar and onshore wind sectors as
to meet rising demand for power in the coming coal-generating infrastructure was already in
winter. place and readily available.
New tariff rules introduced this week mean The new tariff rules mean that only residen-
that only residential and industries linked to the tial and industries linked to the agricultural
agricultural sector will be allowed to maintain sector will be allowed to maintain fixed tariff
fixed tariff purchase programmes. In other areas, purchase programmes.
prices will be allowed to rise. However, the decision to free tariffs could be
When coal hit $234 per tonne earlier in too late for some given that the average amount
October, Beijing was faced with the stark reality of electricity consumed per capita by China’s
that increased – and immediate – investment 1.4bn population has already moved past figures
in renewables may be the only way to make it posted in the United Kingdom and a number of
through the upcoming winter; either that or other western nations.
face wider inflationary repercussions should the For large-scale industries, steel and other
nation’s industrial powerhouses have to cut back metals in particular, and to a lesser extent smaller
on production and subsequent exports. users across the country, the gloves are now off
At present, China’s booming industrial sec- on how high prices can go in a desperate bid to
tor, much of it focused on metal – predominantly limit demand on the domestic grid and force the
steel – production and PV cell manufacturing, biggest consumers to shoulder the brunt of the
accounts for 59% of the total nationwide grid cost of generation.
demand, a number more than double compara- In knock-on effect the most popular forms of
ble figures from the US. renewables, including wind and solar, and to a
Yet despite massive investment in wind and lesser extent hydro-generated power, are at least
solar plants for much of the past decade across expected to benefit.
large swathes of central and southern China, The Chinese language media is now looking
in addition to increased nuclear capacity and at renewables as a possible saviour to help pre-
multiple nuclear power plants (NPPs) at various vent power cuts, and a potential loss of face on
stages of construction, coal continues to pro- the international stage should the upcoming
duce the lion’s share of all energy pumped into Winter Olympics be affected.
the national grid at around 65%. At the same time, authorities in Beijing
Power from renewable sources currently will continue to seek a balance between global
stands at around 28%; an impressive figure demand pushing energy-guzzling production
when held up alongside neighbouring countries, lines across the country, and pressure from
but not enough for the world’s second-largest overseas governments and other cross-border
economy. agencies on CO2 emissions.
And as part of a seemingly never-ending Chinese President Xi Jinping has previously
increase in coal prices in the years since 2017, promised that emissions in China would peak
shortly after China clamped down on numerous by 2030, and the following three decades would
dangerous, and often illegal, mines, annual coal see numbers drop to net zero
prices are up almost 60% year on year after an The winter of 2021-2022, as the wider world
initial dip when coronavirus (COVID-19) first focuses on the Beijing Winter Olympics with
ravaged the country. temperatures in some parts of the country set
Cue a second chance for the renewables sec- to hit 20 below zero, may just prove the tipping
tor across the country. point in pushing the government in Beijing into
Under current legislation imposed by Bei- realising its existing dependence on coal needs
jing, Chinese provinces are limited on the total to be reconsidered, and acted on much sooner
amount of power consumption permissible, than planned.™
which analysts suspect led in recent years to a

Week 43 27•October•2021 www. NEWSBASE .com P7