The in-country analyst has revised its expectations for this year, saying that a healthy, unsubsidized project pipeline will keep the numbers rising in 2021. However, the spending plans needed to raise renewable energy targets in the next five-year plan could put the nation on a collision course with the EU.
November 16, 2020
According to the Asia Europe Clean Energy (Solar) Advisory (AECEA) analyst, China will add 34 to 38 GW of solar power capacity this year and 42 to 48 GW of solar power capacity next year as officials prepare to meet the renewable energy targets with president Xi Jinping’s 2060 increase carbon-neutral promise in mind.
The China-based analyst revised its expectations for this year after the National Energy Administration (NEA) announced last month that the nation had added 18.7 GW of solar by the end of September.
Trade organization The China Photovoltaic Industry Association has rejected a report in which it has lowered its expectations for the year from 35-45 GW to 35-40 GW, although the AECEA’s expectations match the lower number. According to NEA, 10.04 GW of the new capacity was accounted for by utility-scale projects, with residential complexes contributing 5.27 GW and commercial and industrial systems contributing 3.39 GW.
Five year plan
With preparations for China’s next five-year plan, which the AECEA is expected to announce in March, the analyst has speculated that three key clean energy goals could be revised. With the nation looking to get 20% of its primary energy consumption from renewable energies by 2030 and had already hit 15.3% last year, officials could add a 2025 target of 18-19%, according to analysts.
Clean energy provided 28% of total generation last year and could be the subject of a new target of 32% by 2025. Non-hydropower renewables, which generated 10.2% of China’s electricity last year, could target 18.9% for 2025.
The AECEA reports that various institutes have been tasked with estimating how much additional sun would be needed annually to meet such goals. Estimates range from 47 to 64 GW and even 81 GW per year. With such yields, China could host 480-560 GW of solar or even 645 GW of solar energy by 2025. In addition, the current China Renewable Energy Outlook envisages 119 GW of new solar energy per year through 2030 and 150 GW per year in the period 2031-35.
Chinese solar energy is being supported by the introduction of energy storage devices, which AECEA reports require for new PV systems in around a third of the country’s provinces. The analyst assumes that solar-plus storage could reach parity with coal power as early as 2022. The AECEA also pointed to emerging electromobility plans that could secure “gigawatts of additional demand for solar PV per year”.
The new five-year plan, which the AECEA is expected to present for consultation this year, shifted the focus from “integrating and assimilating” foreign innovations to promoting domestic progress in a circular from several ministries in September in which the strategic industries were identified to be prioritized over the next 5-10 years. Technological breakthroughs are desired in areas such as solar, energy storage, smart grid networks, microgrids, distributed energy and hydrogen production and use.
As a result, Guangdong Province has announced that it will focus on solar, including breakthroughs in PERC, high-efficiency CdTe and new cell types, as well as building-integrated thin-film applications and inverters. The AECEA reports that the traditional solar heartland provinces of Jiangsu and Zhejiang have not yet announced their updated industrial strategies.
Roughly a third of the “Guidelines on Expanding Investment in Strategic Emerging Industries and Fostering Increased New Growth Spots” was devoted to funding, and the AECEA has speculated that government funding needed to implement the next five-year plan is targeting China could new collision course with the EU. The bloc is trying to reduce its reliance on Chinese supply chains by building upstream solar production on its territory.
However, the tenor of the AECEA note was positive, predicting that the typical slowdown in activity seen with the launch of a new five-year plan for solar next year due to a pipeline with a grid parity project of 35 to 40 GW at 10 will be avoided would GW of the subsidized projects awarded in 2019 and 2020 that have since moved to grid parity status, accelerating their development schedules. Given that the NEA is considering extending its residential feed-in tariff to next year, after Yunnan Province awarded 3 GW of solar capacity due within 13 months last month and various utility companies have plans for 5 to 6 GW of solar the next Year announced, the future appears bright in the world’s PV superpower.
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