March 14, 2013
Translated by Yu Menglu

China plans to do away with the current national benchmark price for photovoltaic power (PV power) sold on to the grid, according to a draft proposal from the National Development and Reform Commission (NDRC) which is currently being shared with local governments and power generators.

At present, the on-grid tariff for PV produced across the country is one yuan per kilowatt-hour (kWh), though some areas do offer additional subsidies. According to the draft proposal, the NDRC wants to divide the country into four regions with varying on-grid tariffs for solar energy.

According to the draft, most areas in western China will belong to two separate pricing regions. The prices in these two regions are likely to 0.75 yuan and 0.85 yuan per kWh respectively.

In much of eastern China the price will remain fixed at the current national standard of one yuan per kWh.

The remaining parts of the country, which includes Beijing, will make up a final regional which could pay 0.95 yuan per kWh to solar power producers.

According to a report in today's China Business News, opinions are divided over the proposed changes.

Last week at a consultative meeting held by local NDRC officials in Western China, PV equipment manufacturers and representatives from power generation companies suggested that the government should consider lifting the on-grid price in order to guarantee their profits.

However, a PV industry analyst said that due to the amount of sun that western parts of China receive(about 1,700 to 1,900 hours per year), even with the price set at 0.75 yuan per kWh, these companies would still be able to achieve yields of 8 percent.

Before the new pricing system was put forward, a lot of solar power stations were built in western China by generators who assumed they'd be able to sell on to the grid at the one yuan per kWh price.

Links and Sources
CBN: 光伏上网电价拟调低 或掀抢装电站热潮
People’s Daily Online: 发改委发布《关于完善光伏发电价格政策通知》征求意见稿