China Sustainability Project_Policy Brief Series_ChunYuJonathanPOON

INTRODUCTION In the past three years, distributed electricity generation (DG) by solar photovoltaics (PV) has leapfrogged in China, dwarfing even the growth of the Chinese solar industry itself. The year 2012 saw China’s first household DG system installed in Beijing. Two years later, as of the third quarter of 2014, DG capacity had expanded to 3.1 GW, effectively representing 16% of China’s total solar capacity. What may have given rise to the rapid growth of DG, and what challenges lie ahead? The following sections will first discuss the benefits of DG, and the market and policy drivers behind DG’s recent growth in China. Then, a main bottleneck of DG, energy storage, will be discussed.