Circular of the National Development and Reform Commission and the National Energy Administration on Positively Promoting the Work on Subsidy-free Grid Price Parity for Wind Power and Photovoltaic Power
Circular of the National Development and Reform Commission and the National Energy Administration on Positively Promoting the Work on Subsidy-free Grid Price Parity for Wind Power and Photovoltaic Power
Circular of the National Development and Reform Commission and the National Energy Administration on Positively Promoting the Work on Subsidy-free Grid Price Parity for Wind Power and Photovoltaic Power
Fa Gai Neng Yuan [2019] No.19
January 7, 2019
The development and reform commissions (energy administrations), economy and information technology commissions of all provinces, autonomous regions, municipalities directly under the Central Government and Xinjiang Production and Construction Corps, all local offices of the National Energy Administration, the State Grid Corporation of China, China Southern Power Grid, Inner Mongolia Power Company, China Huaneng Group, China Datang Corporation, China Huadian Corporation, National Energy Investment Corporation, China Power Investment Corporation, China Resources Group, China Three Gorges Corporation, the State Development & Investment Corporation, China National Nuclear Corporation, China General Nuclear Power Group, the Electric Power Planning & Engineering Institute, and China Renewable Energy Engineering Institute,
With the large-scale development and rapid technological progress of wind power and photovoltaic power, regions with good resources, low construction costs, and sound investment and market conditions have basically met the conditions for parity with the benchmark on-grid tariff for coal-fired power (without state subsidies). To promote the high-quality development of renewable energy, and improve the market competitiveness of wind power and photovoltaic power, the relevant requirements and support policies and measures for advancing subsidy-free grid price parity for wind power and photovoltaic power are hereby notified as follows.
I. Carrying out the construction of grid price parity projects and pilot low grid price projects. All regions shall conscientiously sum up their experience in the development and construction of wind power and photovoltaic power and combine resources, consumption, and new technology applications to promote the construction of the pilot project of subsidy-free grid price parity for wind power and photovoltaic power that are subject to the benchmark on-grid tariff for coal-fired power (hereinafter referred to as "grid price parity projects"). In regions with good resource conditions and highly guaranteed market consumptions, it is necessary to guide the construction of a batch of pilot low grid price projects with grid prices lower than the benchmark grid price for coal-fired power (hereinafter referred to as "low grid price projects"). On the premise of meeting the renewable energy construction plan of the province (autonomous region, municipality directly under the Central Government) concerned, the relevant national annual management requirements for the monitoring of and early warning for wind power and photovoltaic power, and the satisfaction of grid connection and consumption conditions by power grid enterprises, the competent energy department of the provincial government shall organize the implementation of grid price parity projects and low grid price projects in the region, and the relevant projects are not subject to annual construction scale. For wind power and photovoltaic power projects that have not been started and completed within the prescribed time limit, the project approval (record-filing) authority shall promptly clean up and abolish them, to make room for grid price parity projects and low grid price projects.
II. Optimizing the investment environment for grid price parity projects and low grid price projects. The relevant local government departments shall support grid price parity projects and low grid price projects in terms of land use and land-related charges, form relevant planning linkages, give priority to the use of state-owned unused land, encourage land use in a composite way, reduce the costs related to project sites, coordinate the implementation of project construction and power transmission and consumption conditions, and shall not collect resource transfer fees and other fees in whatsoever form or use local investment and construction of factories and requirements or disguised requirements for the purchase of local equipment as binding conditions for project construction, so as to effectively reduce the non-technical costs of projects. The competent energy departments of local government at all levels may, in concert with other relevant departments, introduce subsidy policies for a certain period of time, and projects that only enjoy local subsidies will still be regarded as grid price parity projects.
III. Guaranteeing prioritized power generation and guaranteed purchase in full amount. For grid price parity projects and low grid price projects for wind power and photovoltaic power, power grid enterprises shall ensure that the power generated by them can be connected to the grid in full amount, and monitor wind and solar abandonment in projects in accordance with the requirements of the renewable energy monitoring and evaluation system. If there is wind or solar abandonment, power grid enterprises shall check and ratify the limited power generation as a negotiable prioritized power generation plan. The checked and ratified prioritized power generation plan can participate in power generation right transactions (transfers) nationwide, and the transaction price will be determined by the market. Power trading institutions shall improve trading platforms and trading varieties, and organize the implementation of related transactions.
IV. Encouraging grid price parity projects and low grid price projects to obtain reasonable gain compensation through green certificate transactions. Grid price parity projects and low grid price projects for wind power and photovoltaic power can obtain the green power certificate for tradable renewable energy (hereinafter referred to as "green certificate") in accordance with the national management mechanism and policy for the green power certificate for renewable energy, and obtain gains through the sale of green certificates. The state guides market-oriented transactions of green certificates through various measures.
V. Earnestly ensuring the fulfillment of the grid connection project construction responsibility of power grid enterprises. In the planning stage of grid price parity projects and low grid price projects for wind power and photovoltaic power, the relevant provincial competent energy departments shall urge provincial power grid enterprises to demonstrate the grid connection plans and consumption conditions for the projects. The relevant provincial power grid enterprises are responsible for all supporting grid projects except for investment in project booster stations and well connect grid connection and other supporting grid construction with project construction progress to enable timely parallel operation of the projects after project completion.
VI. Promoting subsidy-free development of wind power and photovoltaic power through market-oriented power transactions. The National Development and Reform Commission and the National Energy Administration will, in concert with the relevant units, organize the pilot project of market-oriented transactions of distributed power generation. Construction of subsidy-free wind power and photovoltaic power projects is encouraged in demonstration projects such as social capital-invested incremental power distribution networks organized and implemented by the state, clean energy consumption industrial parks, local area networks, new energy microgrids, and energy Internet, and carry out nearby direct transactions by way of pilot programs. Industrial enterprises, data centers and distribution network operators with large, continuous and stable electricity load shall carry out medium- and long-term power transactions with wind power and photovoltaic power enterprises, to realize subsidy-free and market-oriented development of wind power and photovoltaic power projects.
VII. Lowering power transmission and distribution prices and charges for nearby direct transactions. For the pilot projects of market-oriented distributed transactions included in the relevant national pilot programs and demonstrations, the transacted power will only be subject to the transmission and distribution prices of the power distribution network of the voltage levels involved in the grid connection and consumption for wind power and photovoltaic power projects and the power transmission price for the next higher voltage level will be exempted. Policy-based cross-subsidies will be reduced or exempted for renewable energy power involved in nearby direct transactions included in the pilot program.
VIII. Solidly promoting the construction of grid price parity projects and low grid price projects subject to local consumption. The relevant provincial competent energy departments shall independently organize the construction of subsidy-free grid price parity projects and low grid price projects for wind power and photovoltaic power after the coordination and implementation of support policies. Provincial power grid enterprises shall bear the responsibility for the purchase of power in grid price parity projects and low grid price projects, and sign a long-term contract on power purchase and sales at fixed prices (not less than 20 years) with wind power and photovoltaic power project units according to the local benchmark grid price for coal-fired power stipulated by the state when the projects are approved. And such projects are not required to participate in market-oriented power transactions (except for pilot programs of nearby direct transactions and distributed market transactions).
IX. Promoting the construction of subsidy-free wind power and photovoltaic power projects in combination with the construction of trans-provincial and trans-regional power transmission channels.
......
Fa Gai Neng Yuan [2019] No.19
January 7, 2019
The development and reform commissions (energy administrations), economy and information technology commissions of all provinces, autonomous regions, municipalities directly under the Central Government and Xinjiang Production and Construction Corps, all local offices of the National Energy Administration, the State Grid Corporation of China, China Southern Power Grid, Inner Mongolia Power Company, China Huaneng Group, China Datang Corporation, China Huadian Corporation, National Energy Investment Corporation, China Power Investment Corporation, China Resources Group, China Three Gorges Corporation, the State Development & Investment Corporation, China National Nuclear Corporation, China General Nuclear Power Group, the Electric Power Planning & Engineering Institute, and China Renewable Energy Engineering Institute,
With the large-scale development and rapid technological progress of wind power and photovoltaic power, regions with good resources, low construction costs, and sound investment and market conditions have basically met the conditions for parity with the benchmark on-grid tariff for coal-fired power (without state subsidies). To promote the high-quality development of renewable energy, and improve the market competitiveness of wind power and photovoltaic power, the relevant requirements and support policies and measures for advancing subsidy-free grid price parity for wind power and photovoltaic power are hereby notified as follows.
I. Carrying out the construction of grid price parity projects and pilot low grid price projects. All regions shall conscientiously sum up their experience in the development and construction of wind power and photovoltaic power and combine resources, consumption, and new technology applications to promote the construction of the pilot project of subsidy-free grid price parity for wind power and photovoltaic power that are subject to the benchmark on-grid tariff for coal-fired power (hereinafter referred to as "grid price parity projects"). In regions with good resource conditions and highly guaranteed market consumptions, it is necessary to guide the construction of a batch of pilot low grid price projects with grid prices lower than the benchmark grid price for coal-fired power (hereinafter referred to as "low grid price projects"). On the premise of meeting the renewable energy construction plan of the province (autonomous region, municipality directly under the Central Government) concerned, the relevant national annual management requirements for the monitoring of and early warning for wind power and photovoltaic power, and the satisfaction of grid connection and consumption conditions by power grid enterprises, the competent energy department of the provincial government shall organize the implementation of grid price parity projects and low grid price projects in the region, and the relevant projects are not subject to annual construction scale. For wind power and photovoltaic power projects that have not been started and completed within the prescribed time limit, the project approval (record-filing) authority shall promptly clean up and abolish them, to make room for grid price parity projects and low grid price projects.
II. Optimizing the investment environment for grid price parity projects and low grid price projects. The relevant local government departments shall support grid price parity projects and low grid price projects in terms of land use and land-related charges, form relevant planning linkages, give priority to the use of state-owned unused land, encourage land use in a composite way, reduce the costs related to project sites, coordinate the implementation of project construction and power transmission and consumption conditions, and shall not collect resource transfer fees and other fees in whatsoever form or use local investment and construction of factories and requirements or disguised requirements for the purchase of local equipment as binding conditions for project construction, so as to effectively reduce the non-technical costs of projects. The competent energy departments of local government at all levels may, in concert with other relevant departments, introduce subsidy policies for a certain period of time, and projects that only enjoy local subsidies will still be regarded as grid price parity projects.
III. Guaranteeing prioritized power generation and guaranteed purchase in full amount. For grid price parity projects and low grid price projects for wind power and photovoltaic power, power grid enterprises shall ensure that the power generated by them can be connected to the grid in full amount, and monitor wind and solar abandonment in projects in accordance with the requirements of the renewable energy monitoring and evaluation system. If there is wind or solar abandonment, power grid enterprises shall check and ratify the limited power generation as a negotiable prioritized power generation plan. The checked and ratified prioritized power generation plan can participate in power generation right transactions (transfers) nationwide, and the transaction price will be determined by the market. Power trading institutions shall improve trading platforms and trading varieties, and organize the implementation of related transactions.
IV. Encouraging grid price parity projects and low grid price projects to obtain reasonable gain compensation through green certificate transactions. Grid price parity projects and low grid price projects for wind power and photovoltaic power can obtain the green power certificate for tradable renewable energy (hereinafter referred to as "green certificate") in accordance with the national management mechanism and policy for the green power certificate for renewable energy, and obtain gains through the sale of green certificates. The state guides market-oriented transactions of green certificates through various measures.
V. Earnestly ensuring the fulfillment of the grid connection project construction responsibility of power grid enterprises. In the planning stage of grid price parity projects and low grid price projects for wind power and photovoltaic power, the relevant provincial competent energy departments shall urge provincial power grid enterprises to demonstrate the grid connection plans and consumption conditions for the projects. The relevant provincial power grid enterprises are responsible for all supporting grid projects except for investment in project booster stations and well connect grid connection and other supporting grid construction with project construction progress to enable timely parallel operation of the projects after project completion.
VI. Promoting subsidy-free development of wind power and photovoltaic power through market-oriented power transactions. The National Development and Reform Commission and the National Energy Administration will, in concert with the relevant units, organize the pilot project of market-oriented transactions of distributed power generation. Construction of subsidy-free wind power and photovoltaic power projects is encouraged in demonstration projects such as social capital-invested incremental power distribution networks organized and implemented by the state, clean energy consumption industrial parks, local area networks, new energy microgrids, and energy Internet, and carry out nearby direct transactions by way of pilot programs. Industrial enterprises, data centers and distribution network operators with large, continuous and stable electricity load shall carry out medium- and long-term power transactions with wind power and photovoltaic power enterprises, to realize subsidy-free and market-oriented development of wind power and photovoltaic power projects.
VII. Lowering power transmission and distribution prices and charges for nearby direct transactions. For the pilot projects of market-oriented distributed transactions included in the relevant national pilot programs and demonstrations, the transacted power will only be subject to the transmission and distribution prices of the power distribution network of the voltage levels involved in the grid connection and consumption for wind power and photovoltaic power projects and the power transmission price for the next higher voltage level will be exempted. Policy-based cross-subsidies will be reduced or exempted for renewable energy power involved in nearby direct transactions included in the pilot program.
VIII. Solidly promoting the construction of grid price parity projects and low grid price projects subject to local consumption. The relevant provincial competent energy departments shall independently organize the construction of subsidy-free grid price parity projects and low grid price projects for wind power and photovoltaic power after the coordination and implementation of support policies. Provincial power grid enterprises shall bear the responsibility for the purchase of power in grid price parity projects and low grid price projects, and sign a long-term contract on power purchase and sales at fixed prices (not less than 20 years) with wind power and photovoltaic power project units according to the local benchmark grid price for coal-fired power stipulated by the state when the projects are approved. And such projects are not required to participate in market-oriented power transactions (except for pilot programs of nearby direct transactions and distributed market transactions).
IX. Promoting the construction of subsidy-free wind power and photovoltaic power projects in combination with the construction of trans-provincial and trans-regional power transmission channels.
......