Reuters reported last week that the aggregated incentives for solar production could bring $10 billion in capital to the industry over the next three years. This is just a latest piece of the puzzle for western investors to put together to see the whole picture of solar industry in China.
Among the massive economic stimulus plans and clean energy initiatives, China and the US are the top two players. In mid-April, China's Ministry of Housing and Urban-Rural Development announced a stimulus plan for BIPV applications, offering RMB 20/watt for construction material- and component-based BIPV projects and RMB 15/watt for rooftop- and wall-based projects. The ministry accepted applications for an initial round of subsidies until May 15. The number of projects applying for the subsidy has greatly exceeded the government's expectations based on the report from DiGitimes exceeding 500MW in total capacity. The Second round of applications is expected to close by Mid-August.
In terms of mega solar farm projects, below is a list of provinces that announced solar farms:
Qinghai province: the largest solar farm in the world was announced in Jan 2009, China, with a total capacity of 1GW. Suntech Power(STP), Renesolar (SOL) and JA Solar (JASO) are major bidders for a portion of the projects. It is expected most of Chinese solar companies will have a stake in the project, companies such as Best solar, Solarfun Holding (SOLF), Yingli Green (YGE) etc.
Yunnan province: 166MW solar farm was announced in Dec 2008, the $1.3bn facility in the southern province of Yunnan is scheduled to be finished by 2010.
Jiangsu province: This is the latest province to announce a mega solar farm. According to a report from JLM Pacific Epoch, quoting a document released by the Jiangsu provincial government on June 23. The province announced its first 3 -year solar power plan to reach 400MW by 2012. It is expected that local companies, such as Renesola (SOL) and Solarfun (SOLF) will benefit.
Zhejiang province: on June 22, Zhejiang's Hangzhuo city announced a 150MW solar and wind energy project for the next 5 years. As a local solar PV provider, JC solar (acquired by Renesola) will be a tough competitor for the projects.
Australia: Businessweek reports on May 19 that Australia plans a 1GW solar farm as a part of the state's goal of obtaining 20 percent of its electricity from renewable sources by 2020.
Institutional investors have started investment in this green sector, among them is Guinness Atkinson Asset Management which runs funds like the Guinness Atkinson Alternative Energy Fund [GAAEX] and the Guinness Atkinson Asia Focus Fund [IASMX], holds JA Solar, Renesola , Suntech Power, and Trina Solar (TSL). The fund also has a large stake in the largest domestic solar producer, First Solar (FSLR).
Disclosure: Author is long FSLR, SOL, JASO, SOLF.