China Mulls European Solar Projects

Dow Jones Newswires
COPENHAGEN -- State-owned China Energy Conservation Investment Corp., the nation's flagship developer of clean and renewable energy, is in talks to invest and operate solar utility projects in Spain, Italy and Germany, a company executive said Wednesday.
The company late last month obtained a credit line of 20 billion yuan ($2.93 billion) for a period of two years from the state-run Export-Import Bank of China to support its overseas expansion, said Zhang Jun, vice director of the business cooperation department of CECIC.
"The global financial crisis has left some solar projects in those European nations suspended but solar tariffs offered there are still quite attractive, so we are interested in taking over," Mr. Zhang said on the sidelines of the Copenhagen climate summit.
The move comes as China, along with other developing nations, are demanding that rich countries provide tens of billions of dollar worth of funding annually as part of agreements being negotiated at the United Nations-sponsored climate change conference.
China wants rich nations to provide 0.5%-1% of their annual gross domestic product as funding to help developing nations combat climate change for the period to 2020 and beyond, said Zhu Guangyao, China's assistant minister of Finance in Copenhagen.
CECIC is a specialized government agency investing in energy conservation and environment protection projects, whose activities until now have been largely focused in the domestic Chinese market.
It aims to have installed solar power generating capacity of at least 1,400 megawatts connected to the grid by 2012 in China, sharply up from the current 20 megawatts.
CECIC is involved in various clean and renewable energy projects China, including in the wind and biomass-based power sectors, and will also trial an investment model in overseas markets, Mr. Zhang said.
"If the model proves to be successful, then it would be followed by a flurry of investment from other Chinese companies," he said.
CECIC intends to form a consortium with other Chinese companies, including solar module manufacturers, to make the foray overseas, but it will hold the majority stake, he added.
In July, China-based Suntech Power Holdings Co., the world's second largest supplier of solar modules, said it had entered into a strategic agreement with CECIC to develop solar projects over the next five years.
CECIC, which brought online the nation's first 10-megawatt solar utility plant in September, has also submitted two solar projects to the nation's top economic planner - the National Development and Reform Commission - for approval to seek extra funding under the United Nations' Clean Development Mechanism, or CDM.
CECIC plans to list its wind power unit on the Hong Kong Stock Exchange within six months, and this will be followed by a listing on the mainland stock market, Mr. Zhang said.
This follows an initial public offering on the Hong Stock Exchange earlier this month by wind-energy company China Longyuan Power Group Corp, a unit under state-owned power generator China Guodian Group. —-Jing Yang
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