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CCM Data & Primary Intelligence

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CCM Data & Primary Intelligence Description: Policies play a key role in the development and utilization of renewable energy industry, especially for the developing countries. Asia’s renewable energy industry has witnessed fast-growing development in recent years, but compared to Europe, it is still in its infancy on the whole and related policy mechanisms in various countries of Asia remain to be improved. Asia’s renewable energy development is mainly distributed in the countries and areas of East Asia, South-eastern Asia and South Asia (including China, Japan, India, Korea, Taiwan, Indonesia and Thailand, etc.). As one of the main developed countries in the world, Japan has made significant achievements in renewable energy industry, especially in solar energy and renewable energy technologies. As the largest developing countries, China is the leading player of renewable energy development in Asia and its growth in renewable energy industry has showed booming momentum in recent years, especially after implementation of Renewable Energy Law and its supporting policies and incentives. Under the guidance and support of policies and incentives, Asian countries and areas, including India, Indonesia, Thailand and Taiwan, also have obtained obvious achievements and are attaching more importance to the utilizaiton of renewable energy. CCM carried out an in-depth research on renewable energy policies of above countries. Key issues as follows will be comprehensively presented in this report: Interpretation of existing policies and incentives for⎫ renewable energy development and utilization and the latest dynamics; Essence and issuance motivation of the policies and⎫ incentives; Background and situation of energy demand and⎫ supply; Main achievements of renewables development under support of⎫ policies; Limitation of policy system and specific policies and⎫ incentives; Forecast on development of renewable energy policies and⎫ incentives. Main content: No.

Content

I

Overview of renewable energy industry in Asia

I-1

Market situation of Asian renewable energy

1

I-2

Roles of policies and incentives in renewable energy development

1

I-3

Asian renewable energy policy system

2

I-4

Renewable energy policy comparisons in Asia and in Europe

3

II

China’s renewable energy policy analysis

5

II-1

Major policies and incentives by renewable energy

5

II-2

Essence of policies and incentives

19

II-3

Background of policies release

21

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Page 1

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CCM Data & Primary Intelligence II-4

Outcome of policies and incentives

23

II-5

Limitations of policies and incentives

25

II-6

Forecast for renewable energy policies

25

III

India’s renewable energy policy analysis

27

III-1

Major policies and incentives by renewable energy

27

III-2

Essence of policies and incentives

36

III-3

Background of policies release

37

III-4

Outcome of policies and incentives

38

III-5

Limitations of policies and incentives

40

III-6

Forecast for renewable energy policies

41

IV

Japan’s renewable energy policy analysis

42

IV-1

Major policies and incentives

42

IV-2

Essence of policies and incentives

54

IV-3

Background of policies release

54

IV-4

Outcome of policies and incentives

55

IV-5

Limitations of policies and incentives

56

IV-6

Forecast for renewable energy policies

57

V

Indonesia’s renewable energy policy analysis

58

V-1

Major policies and incentives by energy

58

V-2

Essence of policies and incentives

62

V-3

Background of policies release

62

V-4

Outcome of policies and incentives

62

V-5

Limitations of policies and incentives

64

V-6

Forecast on renewable energy policies

64

VI

Taiwan’s renewable energy policy analysis

65

VI-1

Major policies and incentives

65

VI-2

Essence of policies and incentives

68

VI-3

Background of policies release

69

VI-4

Outcome of policies and incentives

70

VI-5

Effectiveness of policies and incentives

71

VI-6

Forecast for renewable energy policies

71

VII

Thailand’s renewable energy policy analysis

72

VII-1

Major policies and incentives by energy

72

VII-2

Essence of policies and incentives

80

VII-3

Background of policies release

81

VII-4

Outcome of policies and incentives

81

VII-5

Limitations of policies and incentives

82

VII-6

Forecast for renewable energy policies

83

Executive summary: (1) Market situation of Asian renewable energy The overall development of renewable energy in Asia, with the resources mainly distributed in the countries of East Asia, South-eastern Asia and South Asia (including China, Japan, India, Korea,

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CCM Data & Primary Intelligence Taiwan, Indonesia and Thailand, etc..), is in the initial stage. The low level of technically exploitable capability for renewable energy resources has resulted in high development costs thereby restricting rapid growth of the installed and power generation capacity in Asia. By 2008, Asia’s total capacity of power generation and heating from renewable energies has reached more than XXX GW and the output of biofuel has exceeded XXX billion liters per year. (2) Roles of policies and incentives for renewable energy development In Asian countries, even all over the world, development costs of all kinds of renewable energies, except hydropower, are higher than that of conventional energies. Therefore, the renewable energy development in Asia can not be driven by market mechanism entirely and thus depends on government’s planning, guidance and supports, which pushes the policies and incentives to play a key role in development of renewable energy industry. (3) Asian renewable energy policy system In the past 30 years, the renewable energy policies in Asia have experienced obvious changes. In early1980s, the governments had started to focus on R&D and demonstration of renewable energies, and then initiated the supports to renewable energy development through market allocation later. In the 1990s, the governments started to take the measures of price guarantee, investment incentives and tax preferences, etc. At the beginning of 2000s, various Asian countries obviously accelerated the formulation and issuance of renewable energy policies and incentives. With these policies, ambitious targets for various renewable energies have been set and some encouragements have been advocated, mainly in the use of power generation technologies of renewable energies, solar water heating technologies, biofuel and purchase of green energies. With continuous release and adjustments of policies and incentives, the Asian countries have established their independent policy system related to renewable energy development. Character of CCM' Report: The aim of this report is to provide powerful assistance to the strategy group and the management team in making correct decision as how to penetrate the ever-increasing China market and how to catch the maximum commercial opportunities. The report is formulated independently by CCM’s professional market researchers, based on the first-hand and primary data which are analyzed by scientific methodology, confirmed with both manufacturers/end users/traders and legal authorities, and presented in a logic way. Sample pages:

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I Overview of renewable energy policy in Asia Table Existing installed capacity of wind and solar power for the World’s top five countries by 2008 Wind power Country Installed capacity (GW) 1 US 25.2 2 Germany 23.9 3 Spain 16.8 4 China 12.2 5 India 9.6 — World Total 121 — EU-27 65 Source: REN21, CCM International Rank

Country Germany Spain Japan US South Korea World Total EU-27

Solar PV Installed capacity (GW) 5.4 3.3 2.0 0.7 0.35 13 9.5

The booming market of European renewable energy industry depends on the promotion of policies and incentives by various countries. The release of policies and incentives by some Asian countries actually are based on the experiences of European countries, especially Germany who is the most successful developer of renewable energy in the world. But there are some disparity between Europe and Asia in renewable energy policies and incentives, shown as follows. „

Many European countries have given priority to renewable energy development through issuing national policies and extending legal supports, but there are few Asian countries having attached sufficient importance to renewable energy development, except China who has obtained remarkable achievements on it.

„

Many European countries have determined long-term planning and objectives and greatly support technology development and equipment manufacturing of renewable energies. However, many Asian countries’ policy supports are discontiguous and the investments in technology development and innovation are significantly inadequate.

„

Although most Asian countries have implemented policies of fiscal supports and tax preferences, European countries generally have a more transparent and clearer execution mechanism for their policies.

„

Many European countries have established investments and financing mechanism that is advanced in security for renewable energy development.

„

Renewable energy pricing mechanism of European countries is more perfect than that of Asian countries.

„

European countries are more active in promotion of CDM and international cooperation.


II China’s renewable energy policy analysis Table Regional distribution of wind power projects in 11th Five-Year Plan Item

Province Hebei

Installed capacity (MW) Under construction Under operation 3,000 2,000

Inner Mongolia

4,000

3,000

Jiangsu and Shanghai

2,000

1,000

Gansu

4,000

1,000

Jilin

1,000

500

Liaoning Xinjiang Shandong

1,000 1,000 600

500 400 200

Guangdong

600

300

Ningxia Fujian Heilongjiang Zhejiang Shanxi

500 400 200 250 250 1,200 20,000

300 200 100 100 100 300 10,000

Key areas

General areas

Others Total Source: NDRC/CCM International

Distribution Zhangjiakou, Chengde, Huanghua, etc. Huitengxile, Huitengliang, Dali, Damao, Tongliao, Bayannaoer, etc. Jiangsu: Rudong, Dongtai, Dafeng, Qidong, etc.; Shanghai: Chongming, Nanhui, etc.; offshore projects of these two areas Yumen, Anxi, Baiyin, etc. Taonan, Taobei, Tongyu, Shuangliao, Changling, etc. Fuxin, Changtu, Kangping, etc. Dabancheng, Alashangkou, etc. Jimo, Qixia, Weihai, Dongying, etc. Huilai, Nanao, Lufeng, Xuwen, Chuandao, etc. Helanshan, Zhongning, etc. Pingtan, Putian, Zhangpu, Gulei, etc. Jiamusi, Yilan, etc. Daishan, Cangnan, Cixi, etc. Zuoyun, Youyu, Shenchi, etc. — —

9 Solar energy plan by 2010 9 The plan focuses on: 1. Implementation of popularization of solar water heater; 2. Launch of solar roofs plan; 3. Construction of large on-grid PV power plants; 4. Trial projects for solar thermal utilization. Table Key projects and distribution of solar power generation Category On-grid PV power generation 1. PV buildings 2. PV power plants Power supply in remote areas Solar thermal power generation Total Source: NDRC, CCM International

Objective (MW) 100 50 50 150 50 300

Distribution Tibet, Gansu, Inner Mongolia, Ningxia, Xinjiang, etc. Beijing, Shanghai, Guangdong, Jiangsu, Shandong, etc. Lasa, Dunhuang and Ordos, etc. Tibet, Qinghai, Gansu, Xinjiang, Yunnan, Sichuan, etc. Inner Mongolia, etc. —

-

9 Renewables utilization plan in rural areas by 2010 The plan focuses on: Active promotion of biogas utilization in rural households; 1. Acceleration of renewable power construction in areas without electricity; 2. Promotion of solid biomass fuel technologies

„

Other renewable policies and incentives

9

Low-interest loan

Most renewable energy enterprises have their own financing channels from the state-owned banks with low interest rate. In addition, they can also get low-interest loans from some national funds, such as China Sovereignty Fortune Fund with fund scale of USD300 billion.


9

Focus on wind power and solar energy

China is preparing for the issuance of Revitalization Planning of New Energy (RPNE), aiming to adjust development objectives for wind power, solar energy, hydropower, bioenergy and nuclear power. Table Predicted adjustment of renewable energies in RPNE Item Wind power Solar power Solar water heater Hydropower Biomass power Biogas Source: CCM International

Previous goal by 2020 30 GW 1.8 GW 2 0.3 billion m 300 GW 30 GW 80 million households

New goal 150 GW 10 GW 2 0.5 billion m 490 GW 58 GW 142 million households

Newly increased investment USD158.1 billion USD616.2 billion USD58.6 billion USD190.3 billion USD29.3 billion USD27.8 billion

As can be seen from the above table, China will focus on the development of wind power and solar energy in the future 10 years and also increase the supporting policies and incentives accordingly. 9

Intensifying implementation of policies

Chinese government will enhance policy implementation intensity in order to expand effectiveness of renewable energy policies and incentives in the future years, which needs to improve the dissemination and supervision of the policies. III India’s renewable energy policy analysis III-1 Major policies and incentives „

Integrated energy policy

India’s Integrated Energy Policy finally received Cabinet approval in late December 2008 after 5-year preparation. The report from the expert committee that was set up to define integrated energy policy was available in 2006 but it was only a press release of the 2008 version. This Integrated Energy Policy especially places emphasize on energy saving, utilization efficiency and increasing exploration of renewable energies. Indian government intends to make it a plan to strengthen climate protection so as to promote sustainable development of energy and ensure energy security. The new energy policy determines the energy price and resource distribution according to market situation, which is aimed at enhancing Taiwan’s energy market competitiveness. The Planning Commission has worked out an effective program to develop domestic energy resources. The establishment of an oversight committee under the cabinet secretary is to supervise the implementation of the renewable energy development plan. The Integrated Energy Policy is characterized by involving all desirable elements of an enlightened policy, including shift to full cost pricing; establishing a consistent tax structure across each energy sector; public sector autonomy, competitive operation and fixed subsidies. The integrated energy strategy for the country would imply, at various levels, an integrated approach to the entire sector: consistent data collection and compilation; for defining both the short and long-term energy demand scenarios; for understanding the linkages between development choices in other sectors of the economy (e.g. urbanization, transport and agriculture) and the energy sector; for pricing energy resources in a consistent manner as well as for ensuring consistency in the regulatory frameworks.


Renewable Energy Policy Analysis in Asia 2010