Many don't believe China was serious when in 2009 President Hu announced plans to reduce CO2 emission by 45% by 2020. This month China may quietly announce new targets to cut emission and boost clean energy technologies in the country. Any clean technology-related industries should benefit from the new policy. Major Chinese newspapers have reported the new announcement may come later this month. New capital has been allocated for incentives. Not only Chinese solar names should benefit in this new environment. American solar makers have also reacted to capture new market share in China including Energy Conversion Devices (NASDAQ:ENER) which has set up a factory in China to meet demand there. First Solar (NASDAQ:FSLR) has also landed several Chinese projects and is looking to build a local factory too. SunPower (SPWRA) is the only company that has not started looking to China. The accounting problem is still weighing on the stock. Management needs to reboot its business ASAP.
China is currently tackling emissions cuts from its steel industry. Local media reported that the central government is demanding that all steel producers reduce waste water and CO2 output and process it before releasing it to the environment. In the last few months, the government has demanded all state controlled steel companies install new facilities to clean up waste water, and demand for these types of equipment has skyrocketed. The power generation companies have also been required to install new equipment to clean up emissions with some even required to shut down generators to meet emission requirement. Environmental remedial products such as those from RINO International (OTC:RINO) are bought by the industry as not many competitors exist in China.
What's happening in China leads us believe that the announcement later this month may be monumental and could be a shock to investors as many didn't see this coming.
Disclosure: Long FSLR