Renewable Energy Expansion after FIT Retrenchment in China

This study examines why renewable energy deployment in China continued after the retrenchment of feed-in tariff (FIT) support. Previous research has examined policy mix, market value, cost reduction, and grid integration; however, less attention has been paid to how these elements jointly affect the profitability conditions of renewable energy projects. The article aims to develop a simple analytical framework that focuses on three determinants of profitability: price, sales volume, and cost. The analysis showed that FIT retrenchment placed downward pressure on electricity prices; however, this effect was partially offset by improvements in sales volume and cost conditions. The findings suggest that China’s post-FIT policy mix supported continued renewable energy expansion not by maintaining high price support, but by improving profitability conditions through the interaction of policy, market, and institutional conditions under lower levels of direct price support.