(Yicai Global) Sept. 26 -- China's northwestern region of Xinjiang heads a list of the country's provinces awarded state subsidies for renewable energy projects.
Xinjiang has 195 of the more than 1,300 projects receiving government aid, according to a sixth annual list published jointly by the finance ministry, the nation's top economic planner and the energy agency. Jiangsu, a coastal province north of Shanghai, comes in second with 139 subsidized projects.
Low-carbon energy projects are key to China's commitment to meet ambitious targets on climate change over the coming decades. The country, the world's biggest investor in green energy, ratified the Paris Agreement on global climate change on Sept. 3, a day before world leaders met in the city of Hangzhou for a G20 Summit.
This year's grants are quite considerable, said Mr. Ding Wenlei, executive director of Yucheng-based Hangyu Solar Technology Co. The support is expected to significantly improve the cash flow of many companies, he said. An official at a listed solar panel maker told Yicai Global that his company had just a few subsidized projects last year, but dozens this year.
But, there is still a significant shortage of subsidy funds. Some insiders say the lack of funds has become a serious obstacle to the development of the renewable energy industry.
The government is extending support to three types of project: power generation from wind, solar and biomass; network engineering; and independent public systems.
In China, policy states that green energy prices in excess of the benchmark grid purchase price, which is based on the regional average cost of local coal-fired electricity plants, can be subsidized by renewable energy development funds. These funds mainly come from additional charges for renewable-energy power levied on commercial, residential and agricultural consumers.
The surcharge has been raised many times and has now reached 1.9 fen per kilowatt (there are 100 fen in 1 yuan, which is worth 15 US cents.)
Gansu province has 130 subsidized renewable energy projects; Ningxia, 101; Qinghai, 86; Inner Mongolia, 84; and Shanxi, 65.