China Sets Waste-to-Power Price Double That of Coal-Fired Plants

China, the biggest carbon emitter, set a price for electricity generated from waste-to-energy plants that’s double that paid to coal-fired projects to encourage renewable-energy development.

Developers of waste-to-energy plants will be paid 0.65 yuan (10 U.S. cents) a kilowatt-hour, the National Development and Reform Commission said today in a statement. Coal-fired projects get 0.3 to 0.4 yuan a kilowatt-hour, according to Bloomberg New Energy Finance.

The rate is above the highest price of 0.61 yuan a kilowatt-hour paid to wind-power projects. Developers of solar projects get paid a minimum of 1 yuan a kilowatt-hour.

“It’s the first time that China has established a fixed price for waste-to-power plants,” Jessica Ng, an analyst at New Energy Finance, said by phone. “It will help energy companies to share the cost burden of the feedstock.”

The government is seeking to cut carbon dioxide emissions by as much as 17 percent per unit of gross domestic product in its five-year plan through 2015. China aims to derive 15 percent of its energy from non-fossil fuels by 2020.

The rate to be paid to waste-to-energy projects may raise retail prices as the government has allowed grid companies to lift them due to an increase in the cost of purchasing power. The nation doubled the surcharges used to offer financial assistance to renewable-energy projects to 0.008 yuan a kilowatt-hour last year.

-- Feifei Shen Editors: Baldave Singh, Randall Hackley

To contact Bloomberg News staff for this story: Feifei Shen in Beijing at Fshen11@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net.

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