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September 10, 2009

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Home » Business » Energy

Solar taps potential with 2GW plant

AMERICAN solar modules maker First Solar Inc will build a 2-gigawatt solar power plant in a desert in the Inner Mongolia Autonomous Region to tap the potentially vast Chinese market following recent government policies promoting renewable energy.

The single project is enough to supply 3 million Chinese homes and is about 14 times the nation's total installed solar capacity estimated at 140 megawatts by last year.

The deal was sealed during a visit by Wu Bangguo, chairman of the Standing Committee of China's National People's Congress, to Arizona where First Solar is based.

The project in the Ordos Desert will be built in four phases and to be completed in 2019. The first phase will have a 30 megawatt demonstration plant that will begin construction by June 1, 2010, First Solar said.

The project will operate under a feed-in-tariff plan which will guarantee the pricing of electricity produced by the power plant over the long term, it said.

China has this year unveiled several state incentive and subsidy programs to speed the development of the solar market.

"This major commitment to solar power is a direct result of the progressive energy policies being adopted in China to create a sustainable, long-term market for solar and a low carbon future for China," First Solar CEO Mike Ahearn said.

A 2GW plant would cost between US$5 billion and US$6 billion if built in the United States, but costs could be lower in China, according to a company spokesman.

China aims to have 2GW of installed solar capacity by 2011 and 10-20GW by 2020.

China is the world's top solar cell supplier but exported 98 percent of products in 2007 and 2008 as high costs made solar less competitive against traditional energy sources.

Industry officials have insisted only a feed-in-tariff plan could solve the problem of high costs.


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