Investment

First Solar still hopeful for historic deal in China

By Lian Mo (China Daily)
Updated: 2010-10-08 07:54

Workers check a solar power station in Shizuishan, the Ningxia Hui autonomous region. Wang Peng/Xinhua

Beijing - Energy giant First Solar Inc is "making progress" on a delayed deal that could be the largest United States investment in China's burgeoning new energy sector.

"We continue to make progress under the agreements that we have signed and remain hopeful of an agreement on the financial framework in due course," Brandon Mitchener, First Solar's spokesman, told China Daily.

Hailed as a symbol of increased cooperation between China and the US in the alternative energy sector, First Solar signed a cooperation framework agreement in last November when US President Barack Obama visited China.

Under the agreement, First Solar will build a 2-gigawatt solar power plant in Ordos, North China's Inner Mongolia autonomous region. Gao Gengui, energy division chief of the development and reform commission of Ordos, said the deal is not dead and talks are continuing.

The project has not been launched yet despite an earlier plan to begin the project in June. The plant should power about 3 million households when it is completed in 2019.

But neither Mitchener nor Gao would reveal the cause of the delay. The bureau of energy under the National Development and Reform Commission, which is in charge of the deal, would not comment.

The Washington Post reported in August that the delay was because the Chinese government wants to launch an open bidding for the project amid mounting complaints from Chinese companies keen to vie for the lucrative project.

Gao denied that report and said: "We didn't invite any company to bid for the project, and this project has never been planned to open for competitive bidding."

Mitchener said "we have not been told of any competitive bidding process with regard to Ordos". Gao said First Solar was invited to join the bidding for another energy project in China, but no bid came from the company. He did not specify that project.

Li Anding, senior researcher at Institute of Electrical Engineering of the Chinese Academy of Sciences, said some people are doubtful whether the thin-film photovoltaic solar module, which First Solar produces, is a technology worthy to develop.

But there is no doubt that US firms are good at innovative research and development, he said. By comparison, Chinese companies are only good at manufacturing. Bloomberg said China's manufacturers grabbed 43 percent of the global photovoltaic-panel market in the past six years and Chinese companies last year shipped $6.6 billion worth of panels that can produce 3,300 mW of power.