China will add 34-38 GW of solar generation capacity this year and 42-48 GW next year, according to analyst the Asia Europe Clean Energy (Solar) Advisory (AECEA), as officials prepare to ramp up renewables targets with president Xi Jinping's 2060 carbon-neutral pledge in mind.
The China-based analyst has revised up its expectations for this year after the National Energy Administration (NEA) last month revealed the nation had added 18.7 GW of solar to the end of September.
Trade body the China Photovoltaic Industry Association has denied a report it has revised down its expectations for the year from 35-45 GW to 35-40 GW, although the AECEA expectation ties in with the lower figure. The NEA said 10.04 GW of the new capacity came in the form of utility scale projects, with residential arrays amounting to 5.27 GW and commercial and industrial systems contributing 3.39 GW.
With preparations well under way for China's next five-year plan – which the AECEA expects to be unveiled in March – the analyst has speculated three important clean energy targets could be revised. With the nation aiming for 20% of its primary energy consumption to come from renewables by 2030, and having already reached 15.3% last year, officials could add a 2025 target of 18-19%, according to the analyst.
Clean energy supplied 28% of total generation last year, and could be the subject of a new, 32% target for 2025; and non-hydro renewables, which generated 10.2% of China's electricity last year, could be set an 18.9% ambition for 2025.
The AECEA reports various institutions have been tasked with estimating how much extra solar would be required annually to hit such targets, with estimates ranging from 47-64 GW, and even as high as 81 GW per year. Such returns could see China hosting 480-560 GW of solar by 2025, or even as much as 645 GW. Beyond that point, the current China Renewable Energy Outlook envisages 119 GW of new solar per year to 2030 and 150 GW annually during 2031-35.
Chinese solar will be helped along by the adoption of energy storage, which the AECEA reports has been mandated for new PV plants in around a third of the nation's provinces, with the analyst anticipating solar-plus-storage could reach parity with coal-fired power as early as 2022. The AECEA also pointed to emerging e-mobility plans which could secure “gigawatts of additional demand for solar PV annually.”
With the new five-year plan – which the AECEA expects to be put out for consultation this year – switching focus from “integrating and assimilating” foreign innovation to driving home-grown advances, a circular issued by several ministries in September identified the strategic industries to be prioritized in the next 5-10 years. Technological breakthroughs are desired in areas including solar, energy storage, smart grid networks, microgrids, distributed energy, and hydrogen production and use.
As a result, Guangdong province has announced an intent to focus on solar, including breakthroughs in PERC, high-efficiency, CdTe and new types of cells as well as building-integrated thin-film applications and inverters. The AECEA reports the traditional solar heartland provinces of Jiangsu and Zhejiang have yet to announce their updated industrial strategies.
Around a third of the ‘Guiding opinions on expanding investment in strategic emerging industries and cultivating strengthened new growth points' circular was devoted to financing and the AECEA has speculated the state-funding required to drive the next five-year plan could set China on a fresh collision course with the EU. The bloc is trying to reduce its dependence on Chinese supply chains by establishing upstream solar manufacturing back in its territory.
The tenor of the AECEA note was positive, however, and predicted the typical slowdown in activity seen with the introduction of a new five-year plan would be avoided for solar next year because of a 35-40 GW grid parity project pipeline, with 10 GW of subsidized projects awarded in 2019 and 2020 having since switched to grid parity status, accelerating their development timelines. With the NEA considering extending its residential feed-in tariff into next year, Yunnan province having last month awarded 3 GW of solar capacity due within 13 months, and various utilities having declared plans for 5-6 GW of solar next year, the future appears bright in the world's PV superpower.
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