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Halfway Home on Renewable Energy Law
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China has finished drafting more than half of the 12 regulations that will be used to implement the landmark renewable-energy law enacted last year, a senior government official said on Tuesday.

 

"Work on seven to eight rules is done," said Xu Dingming, deputy director-general of the Office of the National Energy Leading Group, which is in charge of China's energy strategy and policies.

 

Xu made the comments in Shanghai at an energy conference organized by the Massachusetts Institute of Technology.

 

The official declined to specify which rules were finished or provide a schedule for when the entire job would be done.

 

The government earlier announced it would issue a dozen specific regulations ranging from pricing to preferential policies to standardize and develop the fledging renewable energy sector.

 

The country wants renewable sources such as sunlight, wind and water to account for 16 percent of its energy supply by 2020. The ratio is now around?7 percent.

 

China will invest US$193 billion between 2000 and 2020 on the development of clean energy, according to industry consultancy and investment agency Azure International.

 

The sector's growth potential has drawn huge investment interest from sources such as venture capital firms and the public capital market following the initial public offering of China's Suntech Power Holdings Co in the United States in 2005.

 

But at present, the market for solar companies is mostly in Western countries where some governments subsidize renewable-energy projects to offset their higher costs.

 

Although China published its renewable-energy law last year, many questions remain concerning its implementation. For example, the foundation for pricing and cost sharing is established in the law, but the mechanisms to carry out those measures won't be known until the supplementary rules are issued.

 

There may also be too much funding directed to the solar energy sector as more capacity has come on line in the past year, driven by Suntech's success, a venture capital partner said.

 

"VCs may now shift to other renewables like biomass and biofuels," said Don Ye, president of Beijing-based Tsing Capital, which has invested in two solar-related firms that later went public and has another two in pipeline.

 

(Shanghai Daily April 4, 2007)

 

 

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