**Abstract**
Following the expansion of the photovoltaic (PV) industry and the evolving electricity price subsidy policies, the specifics of the current round of supportive measures have become more transparent. Recently, a reporter learned from a major domestic PV company that the National Energy Administration has been conducting research on policy closure, including potential changes to the existing framework. If no major issues arise, the new regulations could involve electricity metering, billing settlement, and tax adjustments.
The details of how electricity generation will be calculated, how subsidies will be returned, and who will handle these processes remain unclear, causing challenges for companies. A representative from a PV firm stated that these issues have been raised repeatedly with regulators. The latest development is that the National Energy Administration has started seeking public opinions on the relevant policies.
During the consultation period, most companies suggested that electricity metering should include three sets of data: system-generated power, surplus electricity fed back into the grid, and actual consumption. For electricity bill settlements, both sales revenue and subsidy income would be transferred directly to the owner’s bank account on a monthly basis. Regarding tax-related concerns, some companies proposed that the subsidy portion of grid transfers should be exempt from taxes, while distributed systems for individual users could enjoy tax-free benefits, and those for enterprises could receive a 50% tax reduction.
**The Final Rules Will Shape the Future**
According to insiders, the final rules are expected to significantly benefit PV power plant operators. Although the policies may appear to apply broadly, once implemented, they are likely to favor those directly managing PV installations.
This trend is evident in recent policy developments. In July, the long-awaited PV tariff subsidy policy was finally released, implementing a benchmark grid price policy for PV power plants—far exceeding industry expectations. On the eve of National Day, the Ministry of Finance issued a notice offering a 50% reduction in value-added tax for solar energy producers. According to calculations, this tax cut could increase the internal rate of return for PV projects by 1–2%.
**Major PV Players Gain from Strategic Moves**
Industry insiders believe the government is actively opening up the domestic downstream market. Since the second half of the year, multiple expected policies have been introduced, many surpassing industry expectations. This has boosted confidence among PV companies, encouraging them to expand their presence in the downstream sector.
Yingli Green Energy, for example, noted that power station operations are highly profitable but require significant capital. Many PV giants were hesitant to get involved. However, after the introduction of national stimulus policies, the company developed a new financing model, essentially “using bank funds to do its own business.â€
The process involves a specialized PV power development company applying for loans from banks. To ensure timely funding during construction, the company partners with a trust firm, which then arranges for the bank to disburse the money. After project reviews, the funds are allocated to the project company. Additionally, insurance is arranged, and the power station's output is mortgaged to the bank. This strategy helps reduce capital costs and strengthens market position.
**Summary of Recent PV Support Policies**
- Several opinions from the State Council on promoting the healthy development of the PV industry (July 15)
- Notice from the Ministry of Finance on distributed PV generation under the subsidy policy (July 24)
- Notice from the National Energy Administration on the construction of demonstration areas for distributed PV applications (August 20)
- Notice from the National Development and Reform Commission on promoting healthy PV industry development through price mechanisms (August 30)
- Notice from the National Energy Administration on the application of large-scale distributed PV demonstration areas (September 28)
- Notice from the Ministry of Finance on the VAT policy for PV power generation (September 29)
These recent policy updates signal a growing commitment to supporting the PV industry, creating a favorable environment for long-term growth and investment.
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