(Bloomberg) -- China will see the price of offshore wind power dip below that of coal-generated electricity for the first time this year, as the government approves a raft of the renewable energy projects.

A 306-megawatt wind farm off Shanghai has been officially approved to supply electricity at 27% below the coal power price benchmark, according to a report in industrial news outlet BJX.com this week. It’s the latest among several projects that are expected to come online to triple the country’s offshore wind generation capacity to 129 gigawatts by 2030, according to BloombergNEF. 

The 3-billion yuan ($410 million) project, which will install 36 turbines within the year, is jointly owned by Chinese energy giants, China Three Gorges Corp., China National Offshore Oil Corp., and a Shanghai-based investor. Its auctioned on-grid tariff was settled at 0.302 yuan per kWh, making it the first project of its kind to undercut coal power prices in China.

“It begins a new era for offshore wind to compete with coal at even lower prices,” said BNEF analyst Xiangyu Chen.

Local manufacturers have seen production held back by furious price wars in recent years, while onshore projects’ profits have been squeezed by sharp price falls as renewables become the cheapest source of electricity.  

The Asian giant has the world’s largest renewables market, but fossil fuels coal and gas still account for 69% of its power mix. Wind power accounts for 11%.

Listen on Zero: The Godfather of Solar Predicts Its Future

©2024 Bloomberg L.P.