China’s Standing Committee of the National People’s Congress has proposed amendments to the Renewable Energy Law to introduce market-based pricing, prescribe minimum renewable energy consumption requirements and penalties for non-compliance, and improve grid integration.

Renewable Energy Development

The draft prioritizes large-scale wind and solar bases, distributed renewable energy projects, and offshore wind. Existing wind and solar projects could operate beyond their designed service life, subject to assessments and prescribed conditions.

Local governments would be prohibited from requiring supporting industrial investments or collecting project deposits that conflict with national regulations. Competing applications for the same project would be resolved through competitive allocation.

Grid Integration and Pricing

The amendments propose integrating transmission and distribution networks with microgrids. Grid companies would have to disclose connection and transmission capacity and operational information, and provide non-discriminatory access. Renewable generators must improve forecasts, follow dispatch instructions, and meet technical standards.

The draft supports pumped-storage hydropower, new energy storage, conventional plant flexibility upgrades, vehicle-to-grid integration, virtual power plants, and smart microgrids. It also proposes stronger interprovincial transmission infrastructure.

Renewable projects participating in electricity trading would receive market-determined tariffs, while projects outside the market would follow national pricing policies. A sustainable development price settlement mechanism would seek to safeguard reasonable developer returns. Its annual coverage would depend partly on provincial compliance with renewable consumption obligations.

The draft proposes a unified national electricity market, changes to guaranteed purchase arrangements, and changes to capacity markets. Eligible cost differences against local benchmark prices could be compensated through the Renewable Energy Development Fund.

Consumption Obligations and Certificates

National authorities would establish minimum renewable energy consumption shares. Entities could comply through self-generation, direct green power connections, green electricity trading, or green electricity certificate transactions and transfers.

Non-compliant entities could face fines of five to 10 times the certificate cost corresponding to their shortfall, calculated using the preceding month’s average certificate transaction price

Green electricity certificates would verify renewable generation, consumption, and environmental attributes, with proposed links to carbon accounting and international recognition. Certificate transactions would take place on state-recognized trading platforms. Unauthorized transactions could result in confiscation and fines of one to 10 times illegal gains. Responsible personnel could face fines of RMB50,000 (~$7,495.52) to RMB500,000 (~$74,955.2).

Manufacturing, Finance, and Penalties

The Renewable Energy Development Fund would continue supporting research, demonstration, rural applications, remote power systems, resource assessments, and eligible grid costs. The draft also encourages green financing, subsidies, and tax incentives.

Electricity, gas, heat, and hydrogen network operators refusing to correct discriminatory access practices could face fines of up to twice the economic losses suffered by affected entities. Failure to disclose required grid capacity or operating information, maintain complete records, or submit mandatory information could attract fines of RMB100,000 (~$14,991) to RMB200,000 (~$29,982) if corrective orders are ignored. The draft also proposes reciprocal measures against discriminatory foreign restrictions.

In June, China’s National Energy Administration issued measures setting renewable consumption targets for energy-intensive industries and provincial responsibility weights.

In October, China proposed revising the country’s catalog of technologies prohibited and restricted from export to include 12 solar photovoltaic manufacturing-related technologies. The proposed restrictions cover technologies used in polysilicon manufacturing, silicon wafer manufacturing, and solar cell manufacturing.