As the National Development and Reform Commission (NDRC) announced in September 2016, for China 1st batch of 20 pilot CSP projects, the FiT of RMB 1.15/kWh (around USD 18 cents/kWh) could only be enjoyed by those projects which could be finished by December 31, 2018.
However, one and half year has passed since the announcement, as CSP Focus gets from industry resources, most of the 20 pilot concentrated solar power projects will be unable to be accomplished by the end of this year within such a short time.
Relevant report: Detailed Progress on China 1st Batch 20 CSP Pilot Projects
On a closed-door CSP meeting, some CSP project developers and industry players expressed their dissatisfaction to China land policy, and at the same time, expected to see some postponement, earning more time for the 1st batch CSP projects.
Land cost—the biggest stumbling block for China CSP project development
“Money” is the biggest reason why the 1st batch of 20 pilot CSP projects can’t be progressed as expected. Tremendous cost of investment leads to financing difficulty and decision-making difficulty.
For example, in West China, a 50MW CSP project covers an area of 4000+ acres and the land price ranges from CNY 2,000 to 20,000 (around USD310-3,100) per acre. As the 1st expected to be commissioned pilot project, CGN Solar Delingha 50MW parabolic trough CSP plant has paid huge land tax including economic compensation to local herdsmen, farmland conversion tax and prairie conversion fee.
The CSP project owners expressed some complaints on the relatively high land cost. Some said that mirrors used in CSP project own shading function and weekly cleaning will water the dry land, which are great benefits for vegetation recovery. In fact, project owners should be compensated for their contribution to vegetation recovery instead of be levied prairie conversion fee.
Over one year postponement is called for FiT deadline
Because of huge investment, less experience and lack of land price standardization, most of the CSP pilot projects are progressed behind expectant schedule. CSP insiders call for stronger support from the government.
With high-capacity thermal energy storage, CSP is commonly recognized as the transformation and upgrading of traditional thermal power. Meantime, CSP industry long value chain will massively drive traditional industries like iron, glass, chemicals and cement. What’s more, CSP industry development will contribute to poverty relief for local civilians.
It’s reasonable to lengthen RMB 1.15/kWh FiT policy, because FiT is the largest support to CSP projects especially those in a relatively new market. Most of CSP projects are located in western regions in China, where the temperature is quite low in winter, resulting the have-to stop of the CSP plants construction.
Considering the current progress, one to two years’ extension are called for the 1st batch CSP plants construction. With 1 or 2 years more, private enterprises will be ready for financing, and the state-owned enterprises will be easier to make final decision, all of these actions could contribute to big progress of those CSP projects. It’s expected that 70%-80% CSP projects can be connected to the grid by the end of 2019.
Industry experts also appeal to the launch and reasonable FiT of the 2nd batch of CSP pilot projects. And the state-owned companies have stronger finance support, and should act as the pioneers to start CSP project construction and trigger the industry development.
Relevant CSP Conference：2018 CSP Focus Conference（March 22-23 Beijing）