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It is an important measure to solve the historical gap of renewable energy subsidies at one time to implement the goal of carbon peak and carbon neutrality

2022.03.10
CWEA

It is an important measure to solve the historical gap of renewable energy subsidies at one time to implement the goal of carbon peak and carbon neutrality

Since the promulgation and implementation of the Renewable Energy Law in 2006, China's renewable energy industries such as wind power and photovoltaic power generation have expanded rapidly, the technical level has been significantly improved, and the cost has been greatly reduced. In the past 10 years, the cost of wind power in China has dropped by 40%, and the cost of photovoltaic power generation has fallen by 70%, which has basically reached a level comparable to the price of coal power. China's renewable energy industry continues to grow and has become the main force supporting the decarbonization of the power system and promoting the implementation of the goals of carbon peak and carbon neutrality. At the same time, the renewable energy industry has become a new engine of economic development. In 2021, China's renewable energy industry attracted more than one trillion yuan, created more than 4 million jobs, contributed more than 300 billion yuan in tax revenue, and achieved huge economic, social and environmental benefits. In this process, the subsidy has played a role in the effect of "four or two thousand pounds". The subsidy policy is one of the most effective ways to promote new technologies to get rid of the existing path dependence and break the technology lock-in effect, with the aim of helping new industries mature rapidly and finally achieve market-oriented survival and development without subsidies.

However, the long-term arrears of renewable energy subsidies have also become an important economic factor affecting industrial development. On the one hand, the reason is that the source of funds cannot meet the demand for subsidies, and on the other hand, it cannot be collected in full. Based on various factors, it is roughly estimated that the cumulative subsidy arrears at the end of 2021 will be about 400 billion yuan. If the state can solve the problem of subsidy funding gap at one time, it will not only be a great support for industrial development, but also a multi-positive benefit. The first is to alleviate the operating conditions of enterprises, regain the "hematopoietic" function, and have the ability to make long-term investment to ensure the high-quality and sustainable development of the industry; Second, it has maintained the credibility of the government and boosted investment confidence in the field of renewable energy, which is of great significance for the continuous and rapid expansion of the renewable energy market scale and the implementation of the goals and tasks of carbon peak and carbon neutrality. Third, it will also play a positive role in implementing the "six stability" and "six guarantees" goals proposed by the central government, increasing employment and achieving green recovery. In the "Report on the Implementation of the Central and Local Budgets in 2021 and the Draft of the Central and Local Budgets in 2022" submitted by the Ministry of Finance to the Fifth Session of the 13th National People's Congress for review on March 5, it is proposed that the budget expenditure of the central government funds in 2022 will be 807.134 billion yuan, an increase of 98.8% and 101.6% respectively compared with the budget of 405.997 billion yuan and the implementation of 400.331 billion yuan in 2021. The industry is full of optimism.

At present, the time is ripe for a one-time solution to the problem of subsidy arrears. The total plate of subsidy demand has been sealed. First, the number of projects that need to be subsidized has been closed. According to the Notice of the National Development and Reform Commission on Improving the Policy of Wind Power Feed-in Tariffs (Fagai Price [2019] No. 882), starting from January 1, 2021, newly approved onshore wind power projects will fully achieve grid parity, and the state will no longer subsidize them; Starting in 2022, the state will no longer subsidize newly approved offshore wind power projects. According to the national plan, there will be no new subsidy projects for photovoltaic in 2021. In this way, the total plate of wind power and photovoltaic subsidy demand can basically be closed. Second, the subsidy funds for a single project have also been closed. According to the Several Opinions on Promoting the Healthy Development of Non-Hydro Renewable Energy Power Generation (Cai Jian [2020] No. 4), renewable energy power generation projects included in the subsidy catalogue in accordance with laws and regulations shall be approved by the central government according to the "reasonable utilization hours" based on the National Development and Reform Commission when formulating the electricity price policy, and the total subsidy amount is "reasonable utilization hours" multiplied by the operating period of 20 years. In this way, the subsidy funds required for the project to be subsidized and the subsidy funds required for a single project are framed, and the amount of subsidy funds required each year and all the subsidy funds required in the future project life cycle are basically clear, and there is no so-called "bottomless pit".

I hope that everyone's good expectations can become a reality.

Sany Renewable Energy Co., Ltd. is an important business segment of Sany Renewable Energy Co., Ltd. Founded in 2008, it is deeply engaged in the field of renewable energy and is committed to becoming a global leader in clean energy equipment and services.

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It is an important measure to solve the historical gap of renewable energy subsidies at one time to implement the goal of carbon peak and carbon neutrality

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