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China Adds Teeth to Its Clean Electricity Targets This Year

imageStock Markets9 hours ago (Jun 01, 2020 09:00PM ET)

(C) Bloomberg. Power lines carrying electricity from the Golmud Solar Park hang from transmission towers on the outskirts of Golmud, Qinghai province, China, on Wednesday, July 25, 2018. China has emerged as the global leader in clean power investment after it spent $127 billion in renewable energy last year as it seeks to ease its reliance on coal and reduce smog in cities, according to a report jointly published by the United Nations and Bloomberg New Energy Finance in April. Photographer: Qilai Shen/Bloomberg

(Bloomberg) — China boosted its clean energy targets for 2020 and said it would for the first time formally monitor whether provinces meet their goals or not.

Nationwide, the country is targeting 28.2% of electricity generation to come from renewable sources, up 0.3 percentage points from last year, the National Development and Reform Commission said in a statement. Non-hydro sources are expected to provide 10.8%, up 0.7 percentage points from last year.

The NDRC also gave individual targets for each province and region, excluding Tibet, which already gets a majority of its power from renewable sources. Grid operators, power generation firms and users will be held accountable for meeting the targets and could be punished with bad credibility records if they don’t.

The announcement came after China last week said it had space in its power grids to absorb 52% more wind and solar capacity this year than it added in 2019. The higher targets and increased capacity imply that renewable installations will increase this year, Morgan Stanley (NYSE:MS) analysts including Simon Lee said in a June 1 note.

China first introduced plans for a renewable energy quota system in late 2017, with implementation on a trial basis last year.

The system is designed to secure demand for clean energy while reducing idle capacity, and it should help the nation to meet its target to derive 15% of its total energy from non-fossil fuels this year, the agency said. China has developed more wind and solar capacity than any other country, but rapid expansion has left grids struggling to accept the influx of intermittent generation.

“The key factor regarding this policy is not the modest increase in 2020 renewable target but the establishment of a long-term monitoring and evaluation system to reduce curtailment,” Lee said in the note.

(Updates with analyst comments in fourth and seventh paragraphs.)

(C)2020 Bloomberg L.P.

China Adds Teeth to Its Clean Electricity Targets This Year

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