{"id":60070380,"date":"2025-02-13T15:01:42","date_gmt":"2025-02-13T15:01:42","guid":{"rendered":"https:\/\/dialogue.earth\/?post_type=news_digest&p=60070380"},"modified":"2025-02-13T15:32:24","modified_gmt":"2025-02-13T15:32:24","slug":"china-shifts-to-market-driven-renewable-energy-pricing","status":"publish","type":"news_digest","link":"https:\/\/dialogue.earth\/en\/digest\/china-shifts-to-market-driven-renewable-energy-pricing\/","title":{"rendered":"China shifts to market-driven renewable energy pricing"},"content":{"rendered":"\n

China will end its fixed pricing mechanism for renewable energy and require electricity generated from such sources to be sold at market-determined rates. The new policy was announced via a government notice<\/a> issued on Friday by the National Development and Reform Commission and the National Energy Administration.<\/p>\n\n\n\n

The move marks a shift away from a system that has provided stable revenues to energy generators in order to attract investment \u2013 one that has underpinned China\u2019s renewable energy sector for years.\u00a0<\/p>\n\n\n\n

Under the new policy, electricity prices will be set through market-driven bidding. New projects will be subject to the rules starting from June. This will be followed by a gradual transition to full marketisation.<\/p>\n\n\n\n

Authorities said the shift aims to ensure prices \u201cmore accurately reflect market supply and demand\u201d as renewable energy capacity surpasses that of coal in China\u2019s power mix. <\/p>\n\n\n\n

The policy change is also expected to improve efficiency of electricity distribution and spur investment in auxiliary services such as energy storage and peak-load regulation, Caixin<\/a> reports.<\/p>\n\n\n\n

Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air (Crea), said<\/a> the reforms could accelerate clean energy development by lowering prices and increasing the appeal of clean electricity for buyers and grid operators. <\/p>\n\n\n\n

However, he warned that renewable energy producers will now be competing against thermal power plants, which continue to benefit from long-term contracts and capacity payments. The latter refers to fixed sums that the plants receive based on installed capacity rather than power generated.<\/p>\n\n\n\n

The long-term impact of the policy on China\u2019s renewable sector will be dependent on implementation at the provincial level as well as how firms adapt to a more dynamic pricing environment, Myllyvirta noted. The notice has directed local governments to develop their own transition plans by the end of 2025.<\/p>\n\n\n\n

Read Dialogue Earth\u2019s previous <\/em>analysis<\/em><\/a> on why local protectionism is not a major barrier to China\u2019s renewables.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

China will end its fixed pricing mechanism for renewable energy and require electricity generated from such sources to be sold at market-determined rates<\/p>\n","protected":false},"featured_media":60006649,"template":"","categories":[758,757],"tags":[17073,580,585],"country":[20000110],"digest-collection":[50039911],"class_list":["post-60070380","news_digest","type-news_digest","status-publish","has-post-thumbnail","hentry","category-business","category-energy","tag-energy-transition","tag-policy","tag-renewables","country-china"],"acf":[],"yoast_head":"\nChina shifts to market-driven renewable energy pricing | Dialogue Earth<\/title>\n<meta name=\"description\" content=\"China will end its fixed pricing mechanism for renewable energy and require electricity generated from such sources to be sold at market-determined rates\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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