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The Climate Post: China Aims to Become Solar Powerhouse With New Subsidies

Posted: 08/08/11 06:10 PM ET

China is already the world's biggest solar panel manufacturer, but now it is making a move to become a major solar energy consumer as well, with a nationwide feed-in tariff to pay people or businesses a subsidy for electricity they produce with solar panels. This follows on the heels of the country's wind energy feed-in tariff in 2009, which led to explosive growth in their wind industry.

China had a mishmash of solar incentives before, but the new policy will give a clearer signal to the market and "encourage more companies to participate in the industry," said an analyst from Bloomberg New Energy Finance.

China's latest five-year plan, released in March, set the goal of using 20 percent renewable energy by 2020, and a solar feed-in tariff has been expected for months -- so in anticipation many solar installations have already gotten rolling, and a flurry of projects may soon qualify.

Fast and Steady Wins the Race?

China, Germany and the UK have the most stable and consistent clean energy policies, which help boost investment, according to a new report by Deutsche Bank Climate Change Advisors.

However, on the same day as China's announcement, the UK put into place a cut in its solar power subsidy for installations over 50 kilowatts, effectively ending "solar farm development" in the country, Business Green argued.

There were a stampede of projects trying to get completed before the deadline, but some are planning more large installations nonetheless. Also, it turns out a loophole in the solar feed-in tariff would have allowed large projects to still get high subsidies -- but the government is now moving to close that.

The UK had planned to raise subsidies for other clean energy -- but it is delaying the raise in the feed-in tariff for anaerobic digesters.

Besides the UK, a number of other European countries -- including Spain, Italy and the Czech Republic -- hacked away at their solar subsidies before, and now the Australian state of Western Australia has also eliminated theirs.

The Canadian state of Ontario, on the other hand, is trying to protect clean energy projects by changing regulations to make it harder to cut clean energy subsidies.

Meanwhile, solar installations have been rising fast worldwide as the price of solar panels has fallen about 20 percent in the past year. But manufacturer's margins are also falling, so it is not clear how much longer these price trends can continue.

Ethanol Subsidy Survives -- For Now

It came down to the wire, but the U.S. Congress passed a deal to raise the debt ceiling before the Aug. 2 deadline, and Obama signed it into law.

But the deal did not include a near-term cut of ethanol tax breaks, as some had expected, which would have netted an estimated $2 billion in additional revenue.

However, it is likely the ethanol tax break will not be renewed, in which case it would cease at the end of this year.

Meanwhile, ethanol producers are pushing for a change in regulations to allow more ethanol to be blended into gasoline, allowing gasoline to be E15 -- 15 percent ethanol -- compared with E10 today. Last month, experts testified to Congress that the higher ethanol content may damage some cars' engines, and more tests were needed to ensure E15 is safe.

There are also plans to carry ethanol in existing oil pipelines -- but a new study found ethanol could crack the pipes, since bacteria that eat the fuel and excrete acids could thrive inside the pipes.

Making the Smart Grid Smarter

There have been many proposals for making our electricity grids and appliances smarter to help them use less electricity at peak times and shift use to off-peak hours of the day.

However, if many people's appliances all switch on suddenly when the electricity rate drops, an MIT study found, the spike in power use could bring down the grid. But smarter tuning of how electricity rates go up and down during the day could avoid the problem.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University's Nicholas Institute for Environmental Policy Solutions.

 
China is already the world's biggest solar panel manufacturer, but now it is making a move to become a major solar energy consumer as well, with a nationwide feed-in tariff to pay people or businesse...
China is already the world's biggest solar panel manufacturer, but now it is making a move to become a major solar energy consumer as well, with a nationwide feed-in tariff to pay people or businesse...
 
 
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HUFFPOST SUPER USER
WarriorLemming
Willard Romney, "runs-with-scissors".
04:23 AM on 08/09/2011
Many of our U.S. jobs have been sent to China and now they are living well.....
01:19 AM on 08/09/2011
It's well known that China has always been the number 1 in producing something. The competition in this sphere is good, except the fact that chinese use cheap coal energy?!
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HUFFPOST SUPER USER
almostlyniceguy
Not young enough to know everything..
01:01 AM on 08/09/2011
China is not only going to whip us in solar and wind, but they have made a national goal the development of electric cars.

We can do it better and cheaper, if we invest our resources. We no longer have the political will to be a technology leader.
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HUFFPOST SUPER USER
Malcolm Hensley
Last of the Reagan Republicans
11:23 PM on 08/08/2011
Yes, China is making the majority of the solar cells with cheap dirty coal energy. The rest of us just can't compete! The Smart Germans businessmen saw this and sold them the know how! Now they import Chinese solar cells.

Melting sand with electric arch furnaces is energy intensive. However by 2035 even with the fourth largest proven reserves they will be in worse shape than the U.S. and our addiction to oil. With cheap dirty coal energy and no worries from the EPA from emitting large amounts of NF3, because emission controls - add cost. They are the dominate manufacturer in the world!

So China because of their consumption of coal and it's limited supply are also looking at solar. For them it's kind of like taking your cousin to the Prom! But first they will go with their #1 hot date Nuclear!

http://e360.yale.edu/feature/chinas_nuclear_power_plans_unfazed_by_fukushima_disaster/2432/

"Facts of Life" for better or worse.
Genders
Love, Tolerance, Enlightenment
01:43 AM on 08/09/2011
Every solar panels they deploy generates 10 times the energy needed to make it full cycle about 20 years, and the panels will last 50-100 years. Solar cells don't use NF3, electronics do.

China is rethinking nuclear power, and have halted all marine permits.

Nukes are dead, how many disaster will it take for you to get it?
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HUFFPOST SUPER USER
Malcolm Hensley
Last of the Reagan Republicans
12:18 PM on 08/09/2011
Genders, I disagree. No offense.

http://www.lowtechmagazine.com/2008/03/the-ugly-side-o.html

This is not an unfriendly site for solar but it has a realistic point of view. I've never seen estimates for 50-100 years - 40 years tops. After 20 years they produce less than 80% of their original output unless they are meticulously maintained and cleaned. Most of these upper limits have been achieved in the Mediterranean area, a relatively mild climate.

http://news.softpedia.com/news/Solar-Panel-Production-Releases-Dangerous-Chemical-97366.shtml

As for Solar cells don't use NF3, I have a dozen more sites that say they do.

As for China;

http://www.huffingtonpost.com/2011/08/08/china-nuclear-power-plan-japan_n_920851.html?ir=World

As for nukes are dead - I not in a position to decide that for the world. But I appreciate the vote of confidence.
08:30 PM on 08/09/2011
China will soon dominate the world with nuclear technology. You should have know this if you've been reading Huff Post. Solar and wind will never compete with nuclear. They will compliment nuclear power, but nuclear and natural gas will always be needed for base load.