China regulators may cut solar subsidy by 13% in some regions, say reports

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Regulators that oversee China’s solar industry have considering increasing the cut in subsidy that solar farms in some regions of the country receive in response to the continued fall in price of solar modules, reports Bloomberg.

Having spoken to two people familiar with the matter, Bloomberg says that the proposed 2% reduction initially planned by the National Development and Reform Commission (NDRC) for next year may be increased to 13% for solar plants that are located in China’s least sunny regions.

Nothing has been finalized, but talks are at an advanced stage following efforts being made at government level to tackle the impact of record-low solar module prices.

Bloomberg data shows that solar panel prices in China have fallen by 26% in the space of a year, which has meant lower bids at auction among solar developers. Last week it was reported that a new record low bid of 0.52 yuan/kWh was lodged at auction in Inner Mongolia.

The Chinese government sets the levels of tariff that developers of solar power receive, which includes both government subsidies and prices paid by the utilities.

Many developers have been left without payment for many months, but just this week United PV reported that it had received notification of back payment for 16 of its solar farms in China, amounting to a total of around $195 million in delayed subsidies being paid.