SHANGHAI- A CNY20-per-watt subsidy for some building-integrated solar projects in China was announced without adequate consultation with the National Development and Reform Commission, and may lead to various problems in implementation, a senior expert with the NDRC's Energy Research Institute said Wednesday.

"The (subsidy) announcement came out too hastily," said Wang Sicheng, who is a senior researcher with the institute. "It should have gone through more consultation with the NDRC to work out issues such as how the projects are going to be connected to the grid (before it was announced)."

Ren Dongming, vice director of the Renewable Energy Center under NDRC's Energy Research Institute, also told Dow Jones Newswires that he hasn't heard of any recent progress in government discussions on offering preferential on-grid power tariffs to solar utility projects.

Such comments from the senior researchers with NDRC, which is in charge of setting pricing regimes including the one for power, may indicate that the expansion of the subsidy to more sizable utility plants that many are hoping for could be quite far off.

China's Ministry of Housing and Urban-Rural Development and the Ministry of Finance said on March 26 that a subsidy of up to CNY20 per watt ($2.93/watt) will be provided this year to rooftop and building-integrated solar projects that can obtain approvals.

With the subsidy, costs for solar power generation could be reduced to around CNY1 per kilowatt hour, the ministries said in a follow-up statement Tuesday.

They also said in the statement that the subsidy, which will be adjusted on an annual basis, should be able to cover nearly 50% of total solar panel manufacturing and installation costs.

-Jing Yang contributed to this story, Dow Jones Newswires; (8621) 6120 1200; jing.yang@dowjones.com

(Dow Jones, Apr 2, 2009)