Analysts predict that the solar leasing model that has dominated the solar rooftop market in the US could soon become commonplace in China too, as that country tries to encourage more homes and business to install solar.
In Beijing on Thursday, China’s National Energy Administration released its key policy initiative to promote distributed solar generation – installations on home and business rooftops, and ground mounted plants up to 20MW.
The policy is key for the country seeking to accelerate the adoption of solar as an alternative to highly polluting coal and expensive gas. The target for solar in the current year is 13GW, which would make it rival with Japan as the world’s biggest market, although delays in the policy release may make that target hard to realise.
In any case, analysts like SolarBuzz suggest that China could top 100GW of solar by 2018.. This comes as India, the other great importer of coal, is considering increasing its own solar target six-fold to around 140GW.
That push is being supported by new Prime Minister Narendra Modi, and energy giants such as Tata Power, who risk losing billions from bungled investments in so called “ultra mega” coal plants that many thought would underpin the nation’s energy future.
The NEA policy document in China calls for all regions to focus on distributed generation, to reform and strengthen feed in tariffs, provide further financial incentives, and fast track connections.
It wants solar installed on public buildings including affordable housing, railway stations, motorway service area, airports, transportation hubs, major sports venues, parking lots, agricultural land, and more.
It wants solar PV on rooftops for all new construction where possible.
Most interestingly, it is looking at more innovate financing structures such as loan guarantees, leasing models, and strategic partnerships between banks and PV installers – of the type that are being encouraged in Australia through the likes of the Clean Energy Finance Corporation.
“This is likely the document that most Chinese solar companies have been waiting for,” noted Deutsche Bank analyst Vishal Shah.
Shah said the document will likely be followed by other rulings to flesh out some policies, but shows that the government is “substantively supportive” for achieving ambitious distribution generation targets in China.
He also says that it could pave the way for business models such as that adopted by Solar City to develop in China, providing a further driver for solar installation in the country.
Source: RenewEconomy. Reproduced with permission.
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