Four things you need to know about China's renewable portfolio standard Report

Insight 04 April 2018

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Report summary

For years, China's renewable energy output has been constrained and grid companies have not been forced to purchase maximum renewable generation volumes. China recently released a draft policy for its renewable portfolio standard. Though still in its draft form, the RPS policy is a solid step in the right direction after prolonged debate. If well enforced, we expect to see higher capacity utilisation of renewable power, as well as more market transactions that support faster penetration of renewable energy. But the draft policy could be improved by further clarifying the role of grid companies, setting challenging but achievable RPS targets, incentivising coastal markets to import renewable electricity, and adding detailed yet enforceable penalties to drive compliance. They are key to ensuring the policy has real teeth to bite.

What is the renewable portfolio standard?
Renewable generation: watch out for unchallenging targets and inter-provincial market barriers
Coal-fired utilities can relax for now but longer-term competition to intensify
Industrial users that own captive power plants could struggle with higher cost
Multiple roles of power grid companies highlight potential conflict of interests
Conclusion