China has proposed amendments to its Renewable Energy Law to introduce market-based electricity pricing, set minimum renewable energy consumption requirements and penalties for non-compliance, and improve the integration of renewable power into the electricity grid, Mercom India reported.
The draft amendments, proposed by the Standing Committee of the National People’s Congress, aim to support renewable energy development, improve electricity market operations and strengthen the country’s clean energy infrastructure.
Focus on wind and solar expansion
The proposed changes prioritise large-scale wind and solar power projects, distributed renewable energy systems and offshore wind development. Existing wind and solar projects could also continue operating beyond their originally designed service life, subject to technical assessments and prescribed conditions.
Local governments would be prohibited from making additional industrial investments or collecting project deposits as conditions for renewable energy projects when such requirements conflict with national regulations. If multiple developers apply for the same project, the selection would be made through a competitive allocation process.
Grid integration and electricity pricing
The amendments propose better coordination between transmission and distribution networks and microgrids. Grid companies would be required to disclose information about available grid connection and transmission capacity, as well as operational details, while providing equal access to renewable energy producers.
Renewable power generators would be required to improve electricity generation forecasts, follow grid dispatch instructions and meet technical requirements.
The draft also supports pumped-storage hydropower, new energy storage facilities, improvements to the flexibility of conventional power plants, vehicle-to-grid systems, virtual power plants and smart microgrids. It also proposes strengthening electricity transmission infrastructure between provinces.
Renewable energy projects participating in electricity markets would receive prices determined through market transactions, while projects outside the market would follow national pricing policies.
A sustainable development price settlement mechanism is proposed to ensure reasonable returns for renewable energy developers. Its annual coverage would partly depend on how well individual provinces meet their renewable energy consumption requirements.
The draft also proposes establishing a unified national electricity market and revising guaranteed electricity purchase arrangements and capacity market mechanisms. Eligible differences between project costs and local benchmark electricity prices could be compensated through the Renewable Energy Development Fund.
Minimum renewable energy consumption requirements
National authorities would set minimum renewable energy consumption targets for different entities. These requirements could be met through self-generated renewable electricity, direct connections with green power producers, green electricity trading or the purchase and transfer of green electricity certificates.
Entities failing to meet the prescribed consumption requirements could face penalties ranging from five to 10 times the certificate cost corresponding to their shortfall. The calculation would be based on the average certificate transaction price during the previous month.
Stricter rules for green electricity certificates
The proposed amendments would strengthen the role of green electricity certificates in verifying renewable energy generation, consumption and environmental benefits. The certificates could also be linked to carbon accounting systems and international recognition mechanisms.
Certificate transactions would be permitted only through trading platforms recognised by the state.
Unauthorised transactions could lead to the confiscation of illegal gains and fines ranging from one to 10 times the value of those gains. Officials and other responsible personnel could also face individual fines ranging from RMB 50,000 (approximately $7,495) to RMB 500,000 (approximately $74,955).
