China Energy Outlook 2020 - Flipbook - Page 102
high-value PV+ services such as internet-based applications and PV+energy storage, and
increase PV market size through expanding PV business in broader markets including the
overseas market. These efforts have led to progress towards grid parity that enables solar
power to compete with coal power without a subsidy. Currently, there are eleven provincial
jurisdictions where PV generated power reached grid parity in 2019, and three more provinces
are expected to reach grid parity by the end of 2020, ahead of the official target of 2023
(Johnson, 2019).
Addressing Coal-Fired Power Plants
China issued a set of policies and created an early warning system for identifying potential
risks associated with coal power planning and construction in response to significant coal
power overcapacity and worsening emissions.
China is facing significant coal-power overcapacity and consequential worsening emissions.
Since 2016, China has issued a set of policies to limit the construction of new coal-fired power
plants in response to the problem (NDRC, 2016e; NEA, 2016a; NEA, 2016b). These policy
directives plan a series of actions to control coal-fired power expansion. Measures include
establishing an early warning system for controlling overcapacity risks associated with coal
power planning and construction, enhancing compliance with the government energy cap,
tightening control of coal power expansion by ordering construction projects to be slowed
down, postponed, or canceled, and eliminating coal-fired power capacity that uses outdated
technology. (NEA, 2017).
Besides slowing down unchecked expansion of coal-fired power generation, NDRC and NEA
have also attempted to reduce administratively allocated operating hours for existing coal
power plants year by year. As such, all coal-fired generation units approved after the issuance
of Policy Document #9 will no longer receive the pre-determined allocation of operation hours
and are required to fully participate in the power markets and are compensated at market
prices (NDRC, 2017c).
To reduce the coal intensity of power generation, the Chinese government has established
specific fuel intensity targets for coal-fired generation units. The 13th Five-Year Energy
Development Plan urges the power generation sector to keep its overall energy intensity (coal
consumption of generating per unit of electricity) below 310 gce/kWh and keep the intensity
levels of both existing coal-fired power plants over 600MW and any new plants below 300
gce/kWh by 2020. In 2015, at the start of the 13th FYP, the average energy intensity of existing
coal-fired plants over 600 MW was 315 gce/kWh. In 2018, this value has dropped to 308
gce/kWh (Chinapower, 2019; CEC, 2017).
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