«China is likely to revise the target upwards. We’re seeing a similar pattern in terms of policy direction with wind,» said Ko, noting China had exceeded its 2020 target for wind energy as early as 2009.
China WindPower Group Ltd, the largest non-state-owned wind power developer in the mainland, is looking for partners to build solar thermal power projects in China, its director said on Wednesday, banking on a boom in solar demand as the country looks to strengthen support for clean energy.
Solar thermal energy was still at an early stage of development in China, but the company was working to obtain exclusive rights to develop projects in provinces, eyeing local and foreign companies as potential partners, China WindPower Executive Director Samantha Ko told Reuters.
The company, which recently raised $115 million from the sale of yuan-denominated bonds, has signed agreements with local governments to build a combined capacity of 650 megawatts of solar projects using either solar thermal or photovoltaic module technologies.
Ko said the company’s plans for solar thermal projects were at an early stage, declining to give details on investment. But analysts, who put the cost of solar thermal power at $4 million per megawatt, forecast investment at up to $2.6 billion.
Solar thermal power systems use mirrors or parabolic troughs to concentrate heat from the sun and produce steam to drive power generators. The system differs from photovoltaic modules, which are built-in panels that covert sunlight directly into electricity.
In China, utility-scale solar thermal projects are seen as a solution for reducing the country’s dependence on fossil fuels. But the high cost of building thermal plants remain a challenge to development. "Solar thermal could potentially be a bigger market than solar PV (photovoltaic) in China," said Ko.
"It costs three to four times more than wind power so there’s scope for the price to come down," she said, adding that a technological breakthrough or a steep decline in the cost of materials was likely in two to three years.
For now, the company pins its hopes on government support for solar development. Expectations are high that the government will introduce a feed-in tariff that will allow developers to profit from solar projects despite the high cost of construction. China is also expected to meet its solar installation target for 2020 of 20 gigawatts ahead of schedule.