China is looking at abandoning the use of public auctions to set the price for offshore wind power projects, said an official from the National Energy Administration.
Instead of using that system to arrive at a standard price, the government is considering allowing several big state-owned companies to plan such project through negotiating with local governments and authorities such as the State Oceanic Administration. Those initial plans would then have to receive the approval of the National Energy Administration before the work could begin.
“We hope this will become a more effective way to find a benchmark price for offshore wind power projects,” said Shi Lishan, deputy director of the administration’s renewable energy unit.
The practice of using auctions to set standard prices for offshore wind-power projects has evident shortcomings and was adopted merely as a provisional method at a time when few projects involving marine wind power were in operation for China, Shi said.
Last October, China completed its first public auction of four offshore wind-power concessions - deals in which a power-grid company agrees to buy a certain amount of power from a wind project for a certain price, thus protecting the investors in the project.
The concessions were in Jiangsu province and were for a generation capacity of 1,000 megawatts.
Four State-owned companies, including China Datang Corp Renewable Power Co and China Longyuan Power Group Corp Ltd, were the winners at the auction.
