Subsidies may be reduced, incentives for technological advancement expected.
Renewable energy is booming in China: In 2023, the country installed as many solar panels as the entire world did the previous year. This has been made possible by its own manufacturing capacities and access to essential raw materials, from aluminum to rare earths, as well as government subsidies. These subsidies include guaranteed prices for electricity from renewable sources fed into the grid. However, this may soon change. According to a statement from the National Development and Reform Commission and the National Energy Commission, it is time to transition to market-based pricing. This shift is expected to drive “sustainable, high-quality growth,” according to the state news agency Xinhua. Experts believe that these measures could boost technological progress and further reduce energy production costs.
In addition to solar, wind, and hydropower, China also relies on fossil fuels and, along with India, accounts for the majority of global investments in coal power. The country is also a global leader in nuclear energy expansion.
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