China powers up fresh investment for clean tech projects

The Chinese government has announced two major new initiatives to bolster its fast emerging clean tech sector, pledging to invest up to $3bn in demonstration projects and launching new incentives for solar photovoltaic (PV) projects.

According to reports, the Ministry of Science and Technology announced it is to invest between $1.5bn and $3bn in 60 clean tech demonstration projects designed to cut emissions and improve energy efficiency.

The Ministry said it will select projects from a list of 1,200 proposals and expects the various initiatives to cut carbon emissions by 36 million tonnes.

It also predicted that the investments will deliver a boost to the economy of $16.5bn while cutting coal use by eight million tonnes.

The initiative is the latest in a series of green investments from the Chinese government, which has earmarked around 10 per cent of its $585bn stimulus package for environmental and clean tech projects, such as desalination plants, improved water management, solar farms and recycling facilities.

Meanwhile, the Finance Ministry announced new incentives for solar PV projects that will see developers receive Y20 ($2.93) per watt on energy generated from installations of 50kW and above.

The move led to a rally in the stock price of China's leading solar firms, many of which have endured a rough few months as tightening credit conditions have undermined confidence in the market.

Suntech Power saw its stock price soar 49 per cent on the news, while shares in its rival Yingli Green Energy rose 47 per cent.