BEIJING, Dec. 28 (UPI) -- China adopted an amendment to its renewable energy law Saturday that requires utilities to buy all the power produced by generators of renewable energy sources such as wind and solar power.
Power enterprises that refuse to do so will face fines up to an amount double that of the economic loss of the renewable energy company, state-run news agency Xinhua reports.
The amendment also requires the Chinese government to set up a special fund for renewable energy scientific research, finance rural clean energy projects, build independent power systems in remote areas and islands, and build information networks to exploit renewable energy.
The fund would be managed by finance, energy and pricing sectors of the state council.
China's renewable energy law, which took effect in January 2006, covered subsidies, pricing management and supervision measures and was aimed at "optimizing the country's energy structure and safeguarding energy security."
China, the world's largest greenhouse gas emitter, last year relied on coal for nearly 70 percent of its total energy use. But its goal is to increase use of renewable-energy sources to 15 percent of its total by 2020, from 9 percent last year.
Last month Chinese president Hu Jintao announced a separate target ahead of the Copenhagen climate-change summit to reduce the country's carbon emissions relative to economic output by 40 percent to 45 percent from 2005 levels by 2020.
Yet China's emissions will continue to grow as its economy expands.
The amendment "strengthens the confidence of achieving the target" and "contributes to the global fight on climate change," said Wang Zhongying, director of the renewable energy development center of the Energy Research Institute under China's National Development and Reform Commission, Xinhua reports.
According to Xinhua, renewable resources supplied 9 percent of China's total energy consumption last year, equal to reducing carbon dioxide by 600 million tons. It said China used more hydro and solar power than any other country and ranked fourth worldwide for its use of wind power.
But industry experts estimate that one-third of China's wind-generated electricity could not be well transmitted to the grid. The new legislation requires grid companies to improve transmitting technologies and enhance grid capability to absorb more power produced by renewable energy generators.
Xiao Liye, director of the Institute of Electrical Engineering of the Chinese Academy of Sciences, suggested using "smart grids" to enhance grid capability. He said "smart grids" and renewable energy should be developed in tandem like "twin brothers."