China Industry: Feb. 11

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Feb. 11 – This is a regular series of relevant industry news from around China.

Renewables
Chinese renewable energy company A-Power Energy Generation Systems has delivered 10 units of 2.7 MW wind turbines in China. Last year, the company inked a “full-responsibility” deal to develop a 49.5 MW wind farm in the township of Saiwusu, Guba County, Inner Mongolia, for the Urat Rear Banner-based Jihe Orient Wind Energy.

On October 14, 2009, A-Power signed another contract to develop a 19.5 MW wind farm in the Donggang, Rizhao City of Shandong Province. The first five turbines for this wind farm were also delivered on January 27.

Solar power
Beijing’s much-anticipated solar feed-in tariffs, which set off scores of new projects, might be months or even years away. “There is a lot of debate, lots of argument,” revealed Li Junfeng, deputy director-general for energy research at China’s National Development and Reform Commission. He argued that, with just a handful of operational projects under its beltway, China will struggle to gauge the cost of solar-generated electricity and therefore set subsidies.

Bids for the nation’s maiden 10 MW solar concession project, in Dunhuang, Gansu Province, sought subsidies in the range of RMB0.69 to RMB1.9 per kWh. Observers predicted the winning bid of RMB1.09 could be used as a guidepost for the feed-in tariffs, which many developers expected to be in place by the end of last year.

While the economic turmoil drove down solar product prices by as much as 50 percent amid stale demand, the Chinese government still finds costs too high to match with an adequate subsidy.

“The cost price for solar power is still too high, requiring large subsidies that the government cannot afford. Hopefully, in a few years, when the production cost becomes lower, the tariff policy will come out,” said Shi Lishan, deputy director of new ¬energy at the National Energy Administration.

China’s new solar installations hit 150 MW in 2009, bringing the total to 290 MW, according to UK-based consultancy New Energy Finance. This was a whopping increase on the 40 MW added in the previous year.

Company announcements suggest that a further 7–8 GW of grid-connected solar power is in the pipeline, noted Jun Ying, chief China representative at New Energy Finance.

The Chinese government has already adopted a string of measures to energize its renewable energy sector as it seeks to get rid of a reputation as the world’s biggest greenhouse gas emitter together with the Unites States.

The Golden Sun program, unwrapped in July, is designed to give the solar industry a shot in the arm as it grapples with the downturn, while speeding up the rollout of the technology nationwide. A cash pot of US$3 billion was handed out to 222 on-grid photovoltaic projects, 18 off-grid PV systems and 35 large photovoltaic plants.

By the end of this decade, renewable power generation should account for 15 percent of China’s total. But rumor has it that a tougher target is now in the making.

Chinese solar wafer maker Tianwei New Energy Wafer and its 60 percent -owned clean energy specialist Hoku Scientific will explore a USD$50 million investment fund for solar projects in tropical Hawaii.

The companies have signed a Letter of Intent, pursuant to which they will start the process of structuring a solar project financing fund. The fund will provide financing for the installation and operation of commercial, industrial and utility-scale photovoltaic  projects through power purchase agreements.

Relying on the forthcoming introduction of Hawaii’s feed-in tariffs, Hoku’s CEO Dustin Shindo expects that the fund will provide real competitive advantage in the PV market of the sun-kissed state.

Chengdu-based Tianwei New Energy is a subsidiary of Chinese power transmission equipment maker Baoding Tianwei Group. The company took over a majority stake in U.S.-based Hoku Scientific Inc in 2009.

Chinese photovoltaic cells and modules maker Suntech Power Holdings said it has picked the city of Goodyear, Arizona for its flagship U.S. manufacturing facility.

Initially employing 70 and operating at a capacity of 30 MW, the unit may be later expanded to over 120 MW depending on local demand. Suntech’s new factory, touted as the first of a Chinese cleantech firm to bring manufacturing jobs to the United States, will feature state-of-the-art manufacturing technologies and equipment. Plans also call for constructing solar parking structures on the site in order to produce clean electricity to power the plant. The factory is scheduled to be launched in September 2010.

The central city of Arizona was chosen due to its progressive renewable energy standards and solar policies, the supportive business climate and the availability of local manufacturing-ready facilities, the company stated.

Chinese multi-crystalline solar wafers maker LDK Solar has sealed a deal to supply some 30 MW of solar modules to Canada’s COU Solar. Ontario-based COU Solar, a subsidiary of diversified international renewable energy company Oneworld Energy, is a full-service photovoltaic solar integrator with operations in North America and Europe. It makes rooftop and ground-mounted PV installations.

Oneworld aims to become an independent power producer by building, owning and operating over 500 MW of renewable energy projects and generating revenues worth over US$500 million by 2015.

Chinese solar-power products maker Trina Solar announced that it will supply 40 MW of its photovoltaic modules to ITEC Solar GmbH in Germany.The companies have entered into a deal, pursuant to which a total of 18 MW will be delivered during the first half of 2010, starting this February.

Nuremberg-based ITEC Solar specializes in the distribution of top-quality certified modules and the development of various roof- and ground-mounted PV installations across Europe.

The Asian Development Bank has provided a US$1 million grant for a 1.5 MW concentrated solar thermal pilot project in China. A portion of the financing will be used to carry out the prefeasibility assessment of a 50 MW CST power demonstration project in Gansu Province.

The grant comes from ADB’s Climate Change Fund created in 2008 to invest in projects associated with climate change. It marks ADB’s first foray into the Chinese solar power sector.

The projected pilot CSP facility will be rolled out by China Huadian Engineering Company Ltd. The company will also tap into US$1.7 million government funding, taking the total technical assistance cost to US$2.7 million. Completion is scheduled for March 2011.

Eager to brush off its reputation as one of the world’s biggest polluters, carbon-belching China has already implemented a spate of measures to spur on renewable power development.

Solar energy is expected to play a key part in hitting the nation’s 15 percent clean energy target by 2020. The Golden Sun program, unwrapped in July, is designed to give the solar industry a shot in the arm as it grapples with the downturn, while speeding up the rollout of the technology nationwide. A cash pot of US$3 billion was handed out to 222 on-grid photovoltaic projects, 18 off-grid PV systems and 35 large photovoltaic plants.

China-based CNPV Solar Power announced that it would deliver 20 MWp of photovoltaic modules to French solar power projects developer Delta Sud. The companies have reached a strategic partnership deal for PV modules supplies from 2010 to 2012. The first 2.50 MWp are scheduled to be shipped this year.

In a sign the fog shrouding cleantech IPOs might be lifting off, Chinese turbine blade manufacturer HT Blade plans to go public to raise cash for further expansion.

HT Blade, majority-owned by U.S. renewable energy developer Energy Group, has filed preparatory application documents with the China Securities Regulatory Commission, but has been mum on size, timing and location of the listing.

But China Business News reported the company will seek some RMB813 million, aiming to complete the floatation within the first half of 2010. HT Blade has reportedly been mulling over an IPO for a few years, looking at mainland Chinese stock markets to bankroll its bold expansion plans.

In response to bulging demand from China’s burgeoning wind power sector, the manufacturer has scaled up production several times. According to China Business News, it has captured 38-40 percent of the domestic market. Exports to Pakistan, Russia, Chile, Thailand and the United States have earned it an estimated 10 percent share of the global market.

This industry report brief is courtesy of Aii Data Processing.