China plans to erect fewer solar panels this year, despite arrears in government subsidies and problems with its power grids.

China will only add between 26 and 28 gigawatts (GW) of power generating capacity this year, with its share of the global market decreasing to 33 percent from 44 percent last year, IHS Markit reported. Furthermore, Chinese solar farms are expected to grow by just 1.3 percent in 2017 to between 79 and 85 GW, far from the 35 percent increase recorded in 2016.

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"Global demand in the second half, like in last year, will be highly affected by Chinese policy," IHS principal analyst Edurne Zoco said.

According to the South China Morning Post, China erected a total of 34.5 GW of solar farms last year, and two-thirds of which were rushed to be finished before the government's June 30 deadline to reduce subsidies on clean energy.

Apparently, these industrial projects have only sold 60 percent of their output, which is lower compared with their 80 percent target, Frank Haugwitz, founder of Asia Europe Clean Energy Advisory, said. The subsidies come from a renewable energy levy on the electric bills of non-residential and agricultural end-users; but the government has fallen into arrears on subsidy payments after funds ran into deficit.

"About 45 GW, or 60 percent of operation wind and solar farms, are entitled to receive subsidies, but more than 30GW are still waiting to be approved... New sources of funding need to be identified soon," Haugwitz said.

Meanwhile, China's wind and solar sectors are expected to increase fivefold by 2030, boosting the country's GDP. Investment program in clean energy is being eyed to attract a whopping 5.4 trillion yuan ($780 billion) worth of new investments. The wind and solar industries are also slated to pump 14.3 trillion ($2 trillion) into China's GDP. 

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