Policy change to strengthen solar sector

Reduction of feed-in tariffs will be conducive to photovoltaic industry's sustainable and efficient development, government agencies say

Despite a blow that sent solar stocks into free fall in June, China's new rules to reduce government feed-in tariffs for the photovoltaic industry will encourage its more sustainable and efficient development, while stabilizing the rapidly growing and overheating sector, solar power industry insiders said.

The National Development and Reform Commission, the Ministry of Finance and the National Energy Administration announced a cut in the national feed-in tariff by 0.05 yuan (0.7 US cents) per kilowatt-hour on June 1. The authorities also announced a reduction of the same amount in subsidies for power generated by distributed photovoltaic projects. Subsidies for county-level poverty alleviation photovoltaic projects will see no change.