November 13, 2017 / 11:40 AM / a year ago

UPDATE 1-China to launch distributed power trading pilot scheme

(Adds details)

BEIJING, Nov 13 (Reuters) - China will launch a pilot scheme to trade distributed electric power generation, to promote renewable power use, from February next year, the National Energy Administration (NEA) said.

Distributed power plants are typically small- and medium-sized power stations that are installed close to consumers.

The pilot trading programme will only take place in regions with strong power demand and good electricity transmission conditions, the NEA said in a statement on Monday. Regions with severe power waste issues will not be included.

Distributed power generators will be encouraged to trade directly with power consumers or power selling companies, while power grid enterprises will be entitled to charge transmission fees in accordance with the price guide from local authorities.

China will continue to offer subsidies for distributed renewable power projects under the pilot, the NEA said.

However, subsidies on solar and wind power generation will be cut if the power plants participate in the pilot trade scheme as they will get paid from the market.

The feed-in-tariff will fall by at least 10 percent on projects smaller than 20 gigawatts (GW) and by at least 20 percent on projects larger than 20 GW.

Electricity traded on the distributed power market will be counted in renewable power quotas when China fully enforces the quota system on power consumers in 2018.

The distributed electric power generation scheme will be traded on current power trade platforms. (Reporting by Muyu Xu and Beijing Newsroom; Editing by Christian Schmollinger and Alexander Smith)

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