China to pay renewable energy subsidies

Payments will only cover seven months, however.

China will pay overdue subsidies to renewable energy developers following a two-year delay. The decision is expected to somewhat strengthen the balance sheet of renewable energy firms who have been complaining about the delay in reviving their feed-in tariff or FIT subsidies.

The new system established a framework for grid companies to receive funds directly from the Ministry of Finance based on estimated power generation, and to settle their accounts with project developers every month. The last allocation from the NDRC was for the period that ended in the third quarter of 2010.

China last year doubled surcharges on power users to RMB0.008 a kilowatt hour to subsidize renewable energy projects.