Late yesterday, China announced a new raft of energy subsidies meant to bolster the country’s growing solar energy sector.
Beijing will create 13 industry zones and pay up to halfthe price of equipment for solar power projects, the Finance Ministrysaid. It said other costs will be covered by a subsidy of 4 to 6 yuan(60 to 90 U.S. cents) per watt of generating capacity.
The announcement came toward the end of the first of two weeks’ worth of global talks on climate change being held in Cancun, Mexico. China — along with other large developing countries like India and Brazil — has long resisted enacting mandatory targets for reducing emissions ofcarbon-dioxide and other greenhouse gases. The U.S., too, has avoidedadopting mandatory targets by refusing to sign the Kyoto Protocol, themain international framework through which countries negotiateinternational climate change policy obligations.
Thursday’s news today provided a boost to solar energy stocks,especially those companies expected to benefit from the new subsidies.
Another interesting tidbit included in the announcement: Beijing isaiming to install at least 1,000 megawatts of solar generating capacityeach year through 2020. According to the AP, that’s roughly equal toinstalling two standard coal-fired power plants per year starting in2013. That’s a good deal of solar power capacity. And China’s goal ofderiving 15 percent of its electricity from renewable sources by 2020 is laudable. But, given that the country allegedly installs a new coal-fired plant each week, it’s clear that solar power’s role in China’s energy future will be overshadowed by that of coal.
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