The Chinese government recently released "Several Opinions on Promoting the Healthy Development of the Photovoltaic Industry," marking a significant step in the country's renewable energy strategy. This policy not only increased the target for photovoltaic power generation from 21 GW to 35 GW under the "Twelfth Five-Year Plan for Renewable Energy Development" but also provided clearer guidelines for distributed generation, large-scale PV plant construction, and international market expansion.
However, some experts have raised concerns about the potential financial gap that could arise. According to calculations, by 2015, the total funding shortfall for renewable energy sources—such as hydropower, wind, solar, and biomass—could reach 80 billion yuan. To cover this gap, the additional renewable energy surcharge per kilowatt-hour would need to be doubled to at least 1.6 cents, up from the current 0.8 cents. This increase is essential to ensure that subsidy funds are adequately available for the growing industry.
In addition, an upcoming policy titled "Notice on Perfecting PV Power Pricing Policy" is expected to be released soon. It will introduce four regional benchmark on-grid tariffs for large-scale photovoltaic projects: 0.8, 0.9, 1.0, and 1.1 yuan per kWh. Distributed PV systems will receive a subsidy of 0.45 yuan per kWh. These measures aim to support both large-scale and smaller, decentralized solar projects across different regions.
The new policy has sparked optimism within the industry, with shares of photovoltaic-related companies rising sharply following its announcement. Analysts believe the "Opinions" represent a more comprehensive approach to addressing long-standing issues in the sector, such as overcapacity, weak domestic demand, and insufficient technological innovation.
Meng Xianji, Vice Chairman of the China Renewable Energy Society, emphasized that the document focuses on solving problems through policy coordination rather than isolated actions. He highlighted the importance of market mechanisms and structural adjustments, rather than simply providing direct subsidies. Similarly, Lun Jinbiao of GCL-Poly Jiangsu pointed out that the policy signals a shift towards promoting domestic applications and strengthening the entire supply chain.
China has made remarkable progress in building a self-sufficient photovoltaic industry. From raw material production to module manufacturing, the country now possesses a complete industrial system. For example, in 2011, China produced over 80,000 tons of silicon materials, accounting for one-third of global output. However, despite these achievements, challenges remain, particularly in managing overcapacity and improving efficiency.
The "Opinions" also emphasize the need for stricter controls on new photovoltaic projects, setting minimum efficiency standards for various technologies. This move aims to prevent further overexpansion and promote higher-quality production.
While the policy has been widely welcomed, concerns about funding and subsidies persist. With current annual subsidies falling far short of the required amount, the government faces the challenge of increasing the renewable energy surcharge to ensure financial stability for the industry.
Experts agree that without proper funding and policy implementation, the ambitious 35 GW target may not be met. The coming months will be critical as the government works to address these challenges and ensure sustainable growth in the photovoltaic sector.
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