{"id":34420,"date":"2016-11-23T11:38:00","date_gmt":"2016-11-23T11:38:00","guid":{"rendered":""},"modified":"2020-09-28T12:59:52","modified_gmt":"2020-09-28T12:59:52","slug":"9420-solar-pv-can-help-china-s-poorest","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/9420-solar-pv-can-help-china-s-poorest\/","title":{"rendered":"Solar PV can help China\u2019s poorest"},"content":{"rendered":"
The residents of Yuexi county, a mountainous area in eastern China, must have thought it was their lucky day when they heard they had been selected for China\u2019s new solar poverty alleviation project.<\/p>\n

The 382,000 residents are some of the poorest in the country, living below the poverty line of 2,300 yuan (about US$1 per day). This was the key criteria for their selection in the project, which is part of China\u2019s 13th Five-Year-Plan<\/a>, the roadmap for the nation’s development from 2016 to 2020.<\/p>\n

In 2015, President Xi Jinping announced the Chinese government <\/span>would eradicate poverty in China<\/a> by 2020, which requires targeting the country’s 70 million people living below the poverty line<\/a>. In April, 2015, China\u2019s National Energy Administration released a plan<\/a> to use solar photovoltaics (PV) to increase the income of 2 million Chinese households<\/a> within 16 provinces and 471 counties.<\/p>\n

The project is being piloted in Yuexi county, Anhui province before being rolled out across the country. Villagers identified as living below the poverty line will have rooftop solar panels rated at 3-5 kilowatts <\/span>installed on their roofs and become shareholders in village solar power stations with a generating capacity of around 60-100 kilowatts. The aim is for the solar panels to earn each family 3,000 yuan (around US$430) in extra income each year. Local farmers could also earn additional income by leasing out non-arable lands or maintaining the solar farms.<\/span><\/p>\n

So far, 182 villages (with 30,000 residents) in the county have been identified as eligible for the project. Construction has begun at a staggering pace: 57 solar parks were built in 2015, with the remaining 125 expected to be finished this year.<\/p>\n

Unlike many other developing countries, around 99% of all Chinese households already have access to the grid<\/a>.<\/p>\n

Each household will use the solar electricity generated for their own purposes. This will reduce energy bills and any surplus electricity will be sold back to the grid. Families will also have shared ownership of the solar parks, splitting 40% of the profits between them, with the remaining 60% going to pay back loans and park construction fees. This means that once the solar panels are installed, households and villagers could begin to see the benefits quickly.<\/span><\/p>\n

\u201cIt will take more time before we know the impact of the project,\u201d warned Yixiong Kang from China Carbon Futures Asset Management Company, which is overseeing the financial and technical aspects of the project.<\/p>\n

\u201cBut it could have a huge impact. We are talking about the poorest families. They basically have nothing in their houses that use electricity [because they can\u2019t afford to pay the bills].\u201d The extra income they\u2019ll earn could change that. \u201cIf you want to change the living standards of people, sometimes it\u2019s not enough to just give them electricity. Electricity \u2013 that\u2019s just a power supply. They need greater help,\u201d he added.<\/p>\n

Aside from the direct profits, the villagers would also likely benefit from subsidies paid to solar generation projects in China. The rates are set to go down in 2017<\/a> due to a solar power generation surplus, but, if paid, will also help increase the villagers\u2019 profits. The village level solar stations will also be part of a Chinese emissions trading programme which is currently being established<\/a>. The village solar stations that have certified emissions reductions certificates could trade 1000 kWh of their clean energy to replace one tonne of carbon dioxide emissions on the carbon trading scheme.<\/p>\n

When China\u2019s national cap-and-trade programme <\/span>officially launches in 2017 <\/a>its carbon trading market will be the largest in the world<\/a>. The sums set to be generated are substantial. By the end of October 2015, China had seven pilot carbon trading markets in seven cities and provinces. The total emissions \u2018allowances\u2019 distributed during 2015, said Kang, was the equivalent of 1.2 billion tonnes of carbon dioxide, with a projected turnover of 1.3 billion yuan (around US$188 million).<\/p>\n

Of course, this is all still very much at the pilot stage. The village solar power stations are still being built and it\u2019s not yet known how much electricity from the stations could be sold. But clearly the scheme could generate a substantial income for people surviving on less than a dollar a day.<\/span><\/p>\n

China: World leader in solar<\/strong><\/p>\n

China is the world\u2019s biggest generator of solar power, surpassing even Germany<\/a> with its 43.2 gigawatts of solar capacity in 2015. China\u2019s 13th Five-Year-Plan aims to rapidly increase its solar capacity, adding 15-20 gigawatts each year<\/a>. Despite this huge solar generation capacity, China has a small domestic market to absorb it, which the government is eager to remedy. It introduced its own solar subsidy programmes between 2010 and 2011 but they haven\u2019t been successful. \u201cDistributed solar targets are the only ones that haven\u2019t been met yet,\u201d said Wei Shen, a research fellow at the Institute for Development Studies. \u201cIt is very rare for China \u2013 once you have a political target, it\u2019s always met.\u201d<\/p>\n

Domestic PV installations have been low <\/span>due to a number of factors<\/a>, including difficulties connecting the solar PV energy supply with the electricity grid, city dwellers\u2019 lack of easy access to roof space in their high-rise apartments, and high costs. The NEA\u2019s solar poverty alleviation plan could help create domestic markets to absorb some of China\u2019s total manufacturing solar PV capacity.<\/p>\n

But the project faces considerable obstacles. The first is finance. According to Kang, each <\/span>60 kilowatt village power station costs 480,000 yuan (around US$70,000) to build. A three kilowatt household solar system costs around 24,000 yuan (about US$3,500). The plan seems reasonable on paper until you consider the scale of the project. Those costs add up to a staggering bill of around 30 billion yuan (US$4.5 billion)<\/a> over the next five years. Where will the money come from given that banks are reluctant to provide loans to solar projects<\/a>?<\/p>\n

The project\u2019s short-term timescale also poses a challenge to its long-term sustainability. \u201cThere is a gap between the short-term targets and the long-term vision. It\u2019s not just about up front financing, but about securing long-term financing to make this work for 10 or 20 years,\u201d said Shen. \u201cBut that\u2019s not in the time frame for local officers \u2013 they want this political campaign to be done in two or five years. It\u2019s a swift marriage. But how to keep the marriage long and happy?\u201d<\/span><\/p>\n

Technical challenges<\/strong><\/p>\n

In many places the infrastructure for sending power to the national grid is not in place, which poses a serious technical challenge. Villagers and counties also have little negotiating power <\/a>with monopolistic grid companies.<\/p>\n

Solar panels need to be serviced too. The construction companies contracted to build the solar parks will be responsible for the maintenance of the solar panels during the first five years, said Kang, but he admitted that they were still \u201cworking on the details\u201d and applying for the budgets for the solar panel maintenance from the provincial government. After five years, the county governments aim to \u201ccommercialise the contracts\u201d, leaving families to pay if the panels develop faults, said Kang.<\/span><\/p>\n

\u201cOnce you have all these millions of panels installed on people\u2019s rooftops, will that be the end of this political campaign?\u201d asks Shen. \u201cWho will fix and maintain them if some of them are broken or not connected to the grid? There are a lot of implementation gaps.\u201d As this short film about the afterlife of solar technology<\/a> in the Indian state of Odisha shows, if these gaps aren\u2019t addressed and the solar technology breaks down, no one benefits.  <\/p>\n

Social enterprises and non-governmental organisations could help resolve the problems. They have proven successful in <\/span>introducing distributed solar in East Africa<\/a>, for example. But in China, meddling social organisations aren\u2019t generally welcomed by local governments.<\/p>\n

Shen believes these challenges could hamper the project\u2019s success. \u201cThere are a lot of questions that haven\u2019t been answered. Until they are, investors won\u2019t get too serious about this project.\u201d<\/span><\/p>\n

Despite the obstacles, the project is backed by the central government, which should give hope to poor villagers that are looking to benefit from the scheme. \u201cIn China if the central government want you to work this out then there will be no huge obstacles \u2013 since the central government is very powerful,\u201d said Kang. \u201cBut it still takes time.\u201d<\/p>\n

<\/span><\/div>\n","protected":false},"excerpt":{"rendered":"

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