China’s legislature has amended a 2006 law to call for grid operators to procure all the electricity produced by renewables. The amended law will hugely benefit wind farms in remote regions of the country, and could spark a drive towards smart grid technology.
In doing so, China joins a growing list of countries that already mandate that grid operators prioritize renewably-generated electricity in their energy mix, regardless of how much more expensive it is than coal- or gas-fired electricity.
Grid operators who refuse to buy green electricity face fines up to double the loss they cause renewables developers by not hooking up their projects.
As China’s wind industry expands there is an conflict between project developers who prefer to build wind farms in remote areas such as Inner Mongolia and Gansu and grid operators, who are focused on providing cheap electricity to the population-dense coastal areas.
33% of China’s installed wind energy capacity is not linked to the grid, even as the country targets a 15% renewables slice in its overall power generation by 2020 – up from 9% today.