JV will focus mirrors to leverage sun

By Zhou Yan (China Daily)
Updated: 2010-08-11 14:01
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Technology less expensive than solar panels

YUANLING, Hunan - Beijing Zhonghang Airport General Equipment Co Ltd plans to set up a joint venture to invest in a concentrated solar power (CSP) equipment project worth 878 million yuan ($129.63 million) in Yuanling county of Hunan Province.

Beijing Zhonghang will hold around 30 percent of the joint venture, in which several other "well-known" venture capital firms will participate, Zheng Xueshi, chairman of Beijing Zhonghang said on Tuesday.

He said Beijing Zhonghang remains in talks with other shareholders on the specific registered capital of the newly established firm named Zhongjin Shengtang New Energy Technology Co.

Solar power involves the generation of electricity from the sun. This can be direct as with photovoltaic, or indirect as with concentrating solar power, where the sun's energy is focused via mirrors to boil water, which is then used to generate electricity.

While concentrated solar power plants are more cost-effective and more efficient than widely-used photovoltaic panel installations, they have seen little commercial use in China to date.

The new company is expected to realize 2 billion yuan in annual sales and go public on the ChiNext board for start-ups in Shenzhen within three years, according to Zheng.

China has been making efforts to develop the renewable energy industry to meet the country's goal to cut carbon emissions by 45 percent by 2020.

China has included new energy in the nation's strategic emerging industries' plan, which is slated to receive more support from the central government for economic transformation purposes.

Beijing Zhonghang's latest move is a step further for China to build concentrated power plants using equipments developed from home-grown technologies.

The project will be divided into three phases, and 350 million yuan will be invested in the first phase that will be put into operation next April.

"More capital will be injected afterwards, depending on the market response," Zheng said.

Solar power currently accounts for 0.5 percent of global energy supply, figures from International Energy Agency (IEA) show. China expects to cumulatively install 50 megawatts and 200 megawatts scale concentrated solar power plants by 2010 and 2020 respectively, according to a national plan made in 2007.

However, industry experts warned that more policy measures are needed to boost the industry.

"It remains a policy-driven market. Decision-makers have to consider developing CSP from a strategic perspective to erase investors' concerns on the growth potential of the industry", said Xi Wenhua, director general at International Solar Energy Center, adding that more investment in the research and development of related technologies is essential.

China Daily