In the article, an image titled "PV power price subsidies issued" is displayed. To effectively leverage the role of pricing mechanisms in guiding optimal resource allocation and promoting the healthy growth of the photovoltaic power industry, the government has decided to further refine the pricing policy for photovoltaic power projects, in line with the requirements outlined in the State Council’s "Opinions on Promoting the Healthy Development of the Photovoltaic Industry" (Guofa [2013] No. 24). The following details are hereby announced:
First, the pricing mechanism for photovoltaic power stations: Based on solar resource conditions and construction costs, the country has been divided into three categories. A benchmark on-grid tariff has been set for each category. These tariffs are determined according to the specific solar resources available in each region.
Additionally, the on-grid tariffs for photovoltaic power stations are higher than the local coal-fired benchmark tariffs, including environmental protection surcharges. These differences are subsidized through renewable energy development funds.
Second, the pricing policy for distributed photovoltaic systems: A full-power subsidy policy is implemented, with a subsidy rate of 0.42 yuan per kilowatt-hour (including tax). This subsidy is paid by grid companies through the renewable energy fund. For systems that generate more electricity than they consume, the excess is sold back to the grid at the local coal-fired benchmark tariff.
Moreover, all taxes and fees associated with self-consumed electricity from distributed photovoltaic systems, as well as grid connection service charges such as system capacity fees, will be waived.
Third, the implementation of time-based benchmark on-grid tariffs applies to projects approved after September 1, 2013, and those operating after January 1, 2014. Projects approved before September 1, 2013, will follow the new tariff structure once they become operational. The subsidy standards apply to distributed photovoltaic projects not receiving central government investment support.
Fourth, additional provisions include compliance with renewable energy development plans and investment approval procedures for projects receiving state subsidies. The on-grid tariff or subsidy rate is fixed for 20 years from the project's start. Over time, these rates will gradually decrease to encourage technological innovation, reduce costs, and enhance market competitiveness.
Bidding and competitive methods are encouraged to determine on-grid tariffs or subsidies, but they must not exceed the national benchmark levels. Grid companies are required to provide timely grid access, metering, and settlement services. They must also accurately measure and verify generated and on-grid electricity to ensure proper subsidy applications.
Photovoltaic power generation companies and grid operators must maintain accurate records of on-grid and self-used electricity, tariff settlements, and subsidy amounts. These records are subject to regulatory oversight, and any fraudulent activity will be investigated.
Finally, pricing authorities at all levels must monitor the implementation of on-grid tariffs and subsidy settlements to ensure the effective execution of the photovoltaic power pricing policy.
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