{"id":60070380,"date":"2025-02-13T15:01:42","date_gmt":"2025-02-13T15:01:42","guid":{"rendered":"https:\/\/dialogue.earth\/?post_type=news_digest&#038;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<p class=\"wp-block-paragraph\">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 <a href=\"https:\/\/www.ndrc.gov.cn\/xxgk\/zcfb\/tz\/202502\/t20250209_1396066.html\">government notice<\/a> issued on Friday by the National Development and Reform Commission and the National Energy Administration.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">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<p class=\"wp-block-paragraph\">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<p class=\"wp-block-paragraph\">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.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">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, <a href=\"https:\/\/www.caixin.com\/2025-02-09\/102286620.html\">Caixin<\/a> reports.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air (Crea), <a href=\"https:\/\/www.rechargenews.com\/opinion\/chinas-reforms-show-renewables-can-hold-their-own-but-it-s-not-yet-a-fair-fight\/2-1-1778209\">said<\/a> the reforms could accelerate clean energy development by lowering prices and increasing the appeal of clean electricity for buyers and grid operators.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">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<p class=\"wp-block-paragraph\">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<p class=\"wp-block-paragraph\"><em>Read Dialogue Earth\u2019s previous <\/em><a href=\"https:\/\/dialogue.earth\/en\/energy\/local-protectionism-is-not-a-major-barrier-to-chinas-renewables-2\/\"><em>analysis<\/em><\/a><em> on why local protectionism is not a major barrier to China\u2019s renewables.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>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":"","meta":{"_acf_changed":false,"_has_post_settings":[],"footnotes":""},"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":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v26.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>China 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, 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