A wind farm in Northeast China's Liaoning Province. Photo: CFP

A recent draft regulation for the new-energy sector released by Northeast China's Heilongjiang Province has stirred much public debate. The regulation, which is set to take effect on August 1, says that climate resources like wind and solar power belong to the State, and that any detection or exploitation of climatic resources will require permission from the provincial meteorological authorities, given that "climate resources belong to the State."

The draft has aroused criticism among the public. Some think it is ridiculous to say climate resources are State-owned.

"Will I have to pay the government in order to enjoy the sunshine, or can I get paid by the government if I get sunburned?" one netizen said jokingly on Weibo.

In response, the province's meteorological bureau said that the new regulation does not concern individuals. Some scholars also claimed that it is constitutional to say that climate resources belong to the State, and said the regulation may help to standardize the development of the new-energy sector and reduce irregularities during the development.

However, companies in the sector see it differently, especially the privately owned ones. There is concern that the new regulation may make it more difficult to start a new-energy project in the province and that the lengthier application process may add to the costs.

"If the government wants to further develop the sector, it should help to clear the way for companies, instead of setting up new obstacles," a wind turbine company owner surnamed Wu in Heilongjiang Province told the Global Times.

Profit motive?

Heilongjiang Province is rich in wind power resources and has stepped up its development of the new-energy sector. The provincial government announced in May that it would invest 23.6 billion yuan ($3.71 billion) this year to develop the sector.

The draft regulation is the first local guideline to standardize climate resource utilization. However, it has been greeted by criticism that the meteorological authorities are using it to seek profits.

"It is obvious that the local meteorological authorities are eying a share of the growing new-energy sector," an employee with wind power company China Longyuan Power Group was quoted as saying by China Business Journal on June 23.

The regulation stipulates that permission from the meteorological authority is needed before a company can file an application to the provincial development and reform commission for a new project.

The company must also hand over its climate data to the authorities. Any violation of the rules could incur a fine of up to 50,000 yuan ($7,870), according to the draft.

"The meteorological bureau wants to take advantage of the development of the new-energy sector, but for companies it will mean a great cost burden," said the China Business Journal report, citing a senior executive from a Jiangsu-based solar company.

Ma Xuqing, a spokesman for the province's meteorological bureau, explained that no charges would be generated from the approval process, and said the bureau is by no means seeking profits from the new regulation, Xinhua News Agency reported on June 20.

The regulation only aims to standardize new-energy utilization and reduce irregularities in the sector, according to Ma. And since many new-energy companies are joint ventures, the meteorological bureau needs to have some control over the climate data to avoid it being leaked to foreign countries.

An official from the China Meteorological Administration also said that strengthening regulations on the exploitation of wind and solar energy is for the sake of data security concerns, the Economic Information Daily reported on Friday.

"Such a regulation may help supervise the sector's development, but the local meteorological authority is not entitled to take companies' climate data," Xie Xiaotuo, general manager of Jiangsu-based Sky Solar New Energy, told the Global Times.

Xie noted said that climate data is crucial in starting a new-energy project and companies usually invest a lot in the data collection.

"If the local meteorological authorities could provide useful climate data as well as professional instructions, we would be happy to see their involvement," he said.

However, most local meteorological authorities do not have the data needed for a new-energy project, which demands data for a specific geographical area and a specific time period.

"The meteorological authorities do not have the data - their data usually covers a very large area, so most of the companies in the sector choose to do the data collection themselves," Lin Boqiang, director of the Center for Energy Economics Research at Xiamen University, told the Global Times.

New move unnecessary

Hou Qinghua, an official with the Heilongjiang Energy Saving Association, said that at the moment it takes around a year for a new project to get approval, even without the involvement of the meteorological bureau.

The provincial development and reform commission used to take a major role in the approval of a new-energy project. "If the local meteorological authorities could shoulder some of the development commission's functions, the process may even be shortened, but if not, the application process can only get lengthier," said Hou.

Lin of Xiamen University said that a longer approval process would raise costs, which would surely hamper the development of the sector.

"The new move is unnecessary," said Lin, noting that unqualified projects or malpractices during development can be sorted out and corrected by the local development commission.

Jiang Qifan, an expert from the Heilongjiang provincial people's congress, told Legal Daily on Thursday that the province's legislative body will not delete or change the controversial clauses in the draft in the final version.

Both the province's meteorological bureau and the development and reform commission declined to comment on the matter when reached by the Global Times.

Private companies' concerns

Wu's company produces small wind turbines, and he has been in the industry for almost 15 years.

"The profit margin of private companies has become thinner and thinner these days, due to shrinking overseas demand and growing competition from State-owned companies. More costs will certainly hinder our development," said Wu.

Wu also noted that unlike big State-owned companies, private companies have less capital and require a faster return on investment. "So we cannot afford a lengthier approval process."

The central government announced a plan on June 20 to encourage private capital to enter the new-energy sector.

"But encouraging private capital needs relaxation of policies, not adding further hurdles," said Wu.

The new regulation means that the private sector may feel less certain about their investment, said Dariusz Kowalczyk, a Hong Kong-based senior economist at French investment bank Credit Agricole CIB.

"I don't think other provinces will follow suit and launch similar policies, since the regulation is basically unnecessary," said Lin from Xiamen University.