China will introduce a preferential tariff for energy companies that use solar power for their generating capacity, the Wall Street Journal reported. State-run electricity and distribution companies will pay energy generating companies US$0.16 for every kilowatt hour of solar power that is supplied to the grid, in an attempt to make renewable energy economically competitive against fossil fuels such as coal. By comparison, coal-fired power needs a tariff of only US$0.04 to be profitable. The government is targeting 10-20 gigawatts of installed solar power capacity by 2020, up from a previous target of 1.8 gigawatts. However, installed capacity for solar power at the end of 2008 was less than 0.1 gigawatt. China has overtaken the US as the world’s largest emitter of greenhouse gases and wants renewable energy to make up 15% of its energy mix by 2020.
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