The document, titled The notification of FIT adjustment for new energy by NDRC, is a draft that is open to comments and advice from major industrial players, but it sets out a recommended new FIT from NDRC for renewable energy projects. It had spread on Chinas social media WeChat earlier today, after rumors surfaced yesterday, but so far nobody has confirmed physically seeing the document in person.
The document stipulates that the new FIT for ground mounted PV projects will drop sharply from the previous rates of RMB0.80, 0.88 and 0.98 for the three different areas of the country to RMB0.55, 0.65 and 0.75 respectively, which means a decrease of around 31.25%, 26.14% and 23.47%.
For distributed PV projects, the uniform subsidy used in 2016, which stood at RMB0.42 per kWh, will drop to RMB0.20, 0.25, and 0.30 respectively for the three areas.
Chinas government divides the countrys territory into three areas by solar abundance. The more solar resource it has, the lower FIT will be offered for the projects in this area.
Though there is now likely to be hard negotiation between the Chinese government and all the Chinese PV players, this surprising reduction is much more dramatic than many peoples expectation and shows the firm will that the government has in relation to the cutting of subsidies for renewable energy, as Chinas government believes that it can no longer afford the high cost.