CHINA is accelerating the market-oriented reform of its renewable power pricing system in a bid to build a new power system and promote the sustainable development of renewable energy generation.
The National Development and Reform Commission (NDRC) and the National Energy Administration (NEA) recently issued a joint notice on deepening the pricing reform for electricity generated from renewable energy.
The reform focuses on three key aspects: allowing market forces to determine renewable power pricing, establishing a pricing and settlement mechanism that supports the long-term sustainability, and adopting differentiated policies for existing and new projects.
“This new pricing policy will significantly accelerate the construction of a modern power system and ensure the sustainable development of renewable energy,” said Zhang Dayong, deputy secretary-general of the China Association for the Promotion of Industrial Development.
Industry experts believe this reform is essential as China enters a new stage of renewable energy development.
China highly values the new energy sector, such as wind and solar power, rolling out an array of favourable policies spanning pricing, finance and industry. The supportive measures, including a fixed pricing mechanism, have led to exponential growth in renewable energy capacity.
At the end of 2024, the country’s total installed renewable power capacity reached 1.41 billion kilowatts, accounting for over 40 per cent of its total electricity capacity and surpassing coal-fired power installations.
Despite this rapid expansion, the existing fixed-pricing mechanism for renewable power has struggled to reflect real market supply and demand dynamics.
Conditions are now ripe to shift to market-based pricing, analysts said, citing falling power generation costs and an evolving market and predicting that the reform will enhance industry efficiency and ensure sustainable high-quality growth.
Xinhua
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