China rolls out 37.585 billion yuan NEV subsidy scheme for 2021

China's central government has issued a total of 37.585 billion yuan (about $5.716 billion) of subsidies in 2021 for energy-saving and emission reduction projects, according to the Ministry of Finance (MOF).

The one-year subsidy program will cover 15.689 billion yuan ($2.386 billion) worth of governmental grant for the operation of energy-saving and new energy buses that occurred in 2019, and 1.162 billion yuan ($176.666 million), 6.363 billion yuan ($967.638 million) and 14.372 billion yuan ($2.186 billion) of subsidies for the promotion of new energy vehicles (NEVs) occurring in 2016, 2017 and 2018 respectively.

The central budget is 234% more than that of recorded in 2020. For the promotion of high-efficient electric motors and NEVs, China issued 11.258 billion yuan ($1.712 billion) in subsidies from its central budget, according to the MOF.

An industry insider said the earlier allocation of next year's subsidies will play an important role in keeping stable and healthy growth of China's economy, and helping the country's NEV industry advance into a new stage.

The top three provinces in terms of the subsidies to receive in 2021 are Guangzhou (including Shenzhen), Henan and Shandong (Qingdao), together accounting for 36.81% of the total subsides for NEV promotion and 42.72% of the totals for energy-saving and new energy bus operation.

Receiving a total of subsidies worth 5.859 billion yuan ($891.036 million), Guangdong (including Shenzhen) can become the No.1 mainly thanks to its sound development of local NEV industry. Both GAC Group and BYD, the two significant Guangdong-based automakers, are working harder to enhance their strengths in NEV sector.