China is rich in solar power resources, with the average annual solar radiation level in excess of 5,000MJ/m2 and two-thirds of the country's area experiencing 2,200 or more sunshine hours per year. In order to develop China's wealth of solar power resources, the Chinese government has passed successive legislation including the Renewable Energy Law and the Renewable Energy Medium and Long-term Development Plan, which stipulate medium and long-term objectives for the development of the solar power market. According to these plans, China's total solar power capacity will reach 300MWp in 2010 and 1,800MWp by 2020.
In terms of market development, the Chinese solar power market originally focused on supplying electricity to remote areas, with stand-alone solar and wind-solar hybrid systems accounting for the bulk of activity, although other commercial applications also accounted for a significant share of the market. Beginning in 2009, China announced a series of plans and subsidies intended to support the development of the Chinese solar power industry, including open bidding for solar power plant licenses, the Solar Rooftop Plan and the Golden Sun Demonstration Projects. These activities were aimed at developing large-scale solar power plants and urban rooftop solar power systems.
In 2010, China also enacted a revised Renewable Energy Law giving clearer guidance to address issues in the existing legislation and affirming the role of the Central Government in organization and planning, as well as switching the purchasing system for renewable energy from a mandatory system to a guaranteed purchase scheme. These guaranteed purchase principles make electricity distributors more willing to purchase renewable energy by more clearly defining the relationship between electricity distributors and power generation businesses in terms of rights and responsibilities; it also gives guarantees regarding the launch of future on-grid pricing systems or feed-in tariffs (FIT) for renewable energy.
DIGITIMES Research predicts that in 2010, new installed capacity for solar power systems in China is likely to reach 600MWp. Moreover, as China's forthcoming 12th Five Year Plan will specify new energy sources as focal points for development, the Chinese on-grid solar power market will only continue to grow in importance.
The DIGITIMES Special Report, Overview of China's solar PV policies, provides a comprehensive overview of the laws and policies enacted by China's Central Government, as well as the resulting activities seen at the provincial level, as local governments look to proactively cooperate with the Central Government's policy direction to help develop the nation's domestic alternative energy market.