Change at the top of state grid could have ramifications for Chinese solar

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The operators of renewable energy plants in China could soon benefit from the guaranteed purchase of the clean energy their assets generate, as previously pledged by the central authorities, after a change at the top of the world’s biggest utility.

Beijing has replaced energy industry insider Kou Wei with administrator Mao Weiming at the head of the China State Grid barely a year after installing Kou at the top of the state-owned body.

With Kou effectively demoted in a reshuffle which will see him installed as general manager of state-owned power company China Datang Corp, the change at the top may reflect dissatisfaction at the opposition voiced by the grid to plans outlined by the National Development and Reform Committee (NDRC) in November to guarantee the purchase by grid companies of clean power. When the NDRC called for responses on the proposed regulatory measure, the state grid responded by calling for tighter control of grid investment.

However, Kou may also have been moved on because of perceived foot-dragging by the grid when it came to Beijing’s call to reduce the price of all electricity, a measure which would squeeze margins even tighter for clean energy developers if Kou’s successor moves with more alacrity on the issue.

It appears Beijing is bent on driving through its desired power reforms with the appointment of someone unencumbered by energy industry interests as Mao has become the first China State Grid chairman appointed from outside the industry.