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China’s efforts to reduce some of the world’s worst air pollution are having a bonus positive effect: they are improving the country’s potential to generate solar power as more sunlight reaches the surface of the planet in that part of the world.
Reuters reports that a team of researchers had calculated that China’s photovoltaic potential fell by about 15 percent between 1960 and 2015 because of growing pollution. As a result, by 2016 China was missing out on generating as much as 14 TWh of electricity from solar installations annually, Gizmodo reported, citing the research. That’s enough to power 1.3 households and it also cost local utilities almost US$2 billion in lost power output.
Now that the government is actively working to reduce it, China could reverse the decline, boosting its solar power generation potential by 12-13 percent. This means that the country could boost its solar power output by 74 TWh by 2030. To utilities, this would mean an additional US$6.7 billion in profits over the period.
China is the world’s leader in renewable capacity, especially in solar. According to Reuters, its installed solar capacity at the end of last year stood at 170 GW, representing about 9 percent of its total power generation capacity. Power output from solar installations in 2018 hit 177.5 TWh, which amounted to 2.5 percent of the national power output.
Yet even China’s ambitious solar plans hit a snag when it became clear Beijing is paying too much in subsidies as it set no limits to the amount of new solar capacity installed or its cost-competitiveness with alternative energy systems. As a result, last year China shocked the global solar industry by announcing it would not issue approvals for any new solar power installations by the end of 2018 and would also cut the feed-in tariff subsidy that has been a major driver of the solar business in the country that accounts for as much as 50 percent of capacity.
This has spurred more cost-cutting efforts in the local solar industry with many projects now on par with fossil fuel power plants.
By Irina Slav for Oilrpice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.