Updated: 2005-06-17
Government officials and industry experts are warning policy-makers to be prudent in balancing the interests of different groups within the economy, as laws on renewable energy are introduced.

Pertinent government bodies including the National Development and Reform Commission (NDRC), the State Administration of Taxation and the State Environmental Protection Administration are working together on implementing rules for the country's first renewable energy law, which was passed in February and scheduled to take effect from the start of next year.

"As part of the new law, a proposed regulation on on-grid prices of renewable-energy-generated electricity will be submitted to the central government for approval by November," said Wang Fengchun, deputy director-general of the Research Department of Environmental Protection & Resources Conservation Committee under the National People's Congress (NPC).

Pricing of electricity sold to the country's power grids has been a core issue in the forthcoming law that will be affiliated with a host of major industrial sectors to affect the nation's economy, said Wang Fengchun.

"It is still a tough decision to make over who will be able to afford the higher power price generated by the increased cost of using renewable energy to produce electricity," said Ni Weidou, an academician with the Chinese Academy of Engineering, on the sidelines of the third advisory board meeting of the Tsinghua-BP clean energy centre.

Wang Weicheng, member of NPC's Standing Committee, said it is fairer for the general public to pay for the cost increase when the government starts implementing the law next year, in a move to rationalize economic growth along with the environment and energy concerns.

As well as electricity pricing, the law will include compulsory measures for the country's major energy contributors such as Sinopec and PetroChina to take in a certain amount of oil and gas produced using renewable energy.

"The question remains as to what extent the companies will submit to the new terms, because that will obviously increase their operation costs," Wang Weicheng said yesterday during an energy conservation forum in Beijing.

To meet the surging energy demand in the world's fastest-growing major economy, it is a strategic and secure way to diversify energy sources, including the use of nuclear power and other renewable energies such as wind and solar power, said Guy F Caruso, administrator of the Energy Information Administration of the US Department of Energy.

But it will take more time for the renewable energies to play a larger role in fuelling China's economic growth, added Caruso.