Renewable energy gets huge outlay
By Fu Jing (China Daily)
Updated: 2005-11-08 05:50
Up to 1.5 trillion yuan (US$184 billion) will be invested by 2020 to achieve
China's plan to boost renewable energy consumption to 15 per cent of the
country's energy mix by the benchmark year.
"We are committed to our promises," said Zhang Guobao, vice-minister of the
National Development and Reform Commission. "Our renewable energy law will take
effect beginning next year, and we aim to increase our renewable consumption in
the energy mix from the current 7 per cent to 15 per cent by 2020."
Renewable energy will not only ease the energy shortage, Zhang added, but
also help reduce poverty and mitigate climate change.
The business sector and international co-operation will play crucial roles in
reaching the goals, fostering the well-being of society and a healthier
Zhang said both domestic and overseas investors are encouraged to share in
the massive investment.
"The business sector, instead of the government, will play a leading role in
the investment," Zhang told China Daily yesterday.
Zhang also said the government will step up efforts to make renewable energy
available to the country's 30 million people who still don't have access to
He said international co-operation is essential to achieve China's goals.
The government is considering implementing a bidding system to attract both
domestic and foreign investors in China's massive renewable energy market, he
The government is also considering more favourable incentives to encourage
businesses to invest in the efforts.
Currently, investors enjoy a 50 per cent tax break when investing in solar,
wind and renewable energy. The national value-added tax rate is 17 per cent.
"We are consulting with the ministry of finance to further reduce the tax
burden when they invest in renewable business," he said.
China has made two commitments at last year's international conference on
renewable energy held in Bonn, Germany. One is to make a law regulating
renewable utilization and the other is to map out a national blueprint.
But he complained that developing countries sometimes fell into an
unfavourable position when accepting assistance from developed countries.
"Sometimes, we have been forced to buy equipment from developed countries
when accepting their loan, grant or technical aid," Zhang said. "The expensive
equipment will add to our cost."
Take wind power, for example, in which one kilowatt/hour will cost 0.8 yuan
(US$10 cents), while the equal amount of coal electricity just costs about
one-third of that.
(China Daily 11/08/2005 page2)