City-level analysis of subsidy-free solar photovoltaic electricity price, profits and grid parity in ChinaAbstract

Jay Owen Green Prosperity

Solar Power Now Cheaper Than Grid Electricity Across China, Study Finds

By Matthew Walsh / Environment

August 19, 2019 – The price of solar power has become lower than grid-supplied electricity in hundreds of cities across China, according to a new study, marking an important inflection point in the country’s deployment of renewable energy.
The paper, written by researchers in both China and Sweden and published Monday in the British peer-reviewed journal Nature Energy, concludes that 344 prefecture-level Chinese cities can now deliver lower electricity prices from solar photovoltaics than from the grid, without relying on government subsidies. Solar prices in nearly a quarter of those cities can also compete with coal-generated power, according to the study.
The findings suggest that solar generation across China is approaching grid parity, the critical point at which a new energy resource costs the same or less than grid-supplied conventional energy forms like fossil fuels. Previous studies suggested that grid parity for solar power in China might be years away from becoming a reality.
After years of rapid growth, China’s solar industry has been consolidating since June last year, when the government pulled the plug on its generous subsidies program in a bid to curb excess capacity and wasted investment.
Nonetheless, China remains the world’s largest generator of solar power and installer of solar panels.
Contact reporter Matthew Walsh ([email protected])
Related: Flat Solar Capacity Growth Expected as Sector Consol

By Matthew Walsh / Environment
City-level analysis of subsidy-free solar photovoltaic electricity price, profits and grid parity in China


In recent years, China has become not just a large producer but a major market for solar photovoltaics (PV), increasing interest in solar electricity prices in China. The cost of solar PV electricity generation is affected by many local factors, making it a challenge to understand whether China has reached the threshold at which a grid-connected solar PV system supplies electricity to the end user at the same price as grid-supplied power or the price of desulfurized coal electricity, or even lower. Here, we analyse the net costs and net profits associated with building and operating a distributed solar PV project over its lifetime, taking into consideration total project investments, electricity outputs and trading prices in 344 prefecture-level Chinese cities. We reveal that all of these cities can achieve—without subsidies—solar PV electricity prices lower than grid-supplied prices, and around 22% of the cities’ solar generation electricity prices can compete with desulfurized coal benchmark electricity prices.
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