China Policy: Shedding Light On The Recently Enacted Solar Feed-In-Tariff

Article by Gary S. Wigmore , Shepard Liu , Yaxun Wang and Jeffrey Rector ¹

China's energy regulator, the National Development and Reform Commission ("NDRC"), announced in July of this year its first nationwide feed-in-tariff ("FiT") for solar photovoltaic ("PV") development in an effort to boost China's domestic solar industry and to increase the share of solar power in China's energy portfolio. The FiT has been warmly received by project developers and project lenders, and is expected to significantly incentivize the healthy development of China's solar power industry.

BACKGROUND

China has rich solar resources across its territory. According to the United Nations Environment Program's Solar and Wind Energy Resource Assessment, the annual solar radiation for most regions of China is between 4.5 and 5.0 kilowatts ("kW") per square meter per day. In some of the western parts of China, such as Qinghai, Tibet and Xinjiang, solar radiation reaches between 6.5