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China – Renewable Energy

A renewable energy project in which the World Bank and the Global Environment Facility (GEF) provided $13 million and $27 million respectively, as well as technical assistance, supported a successful initiative led by China to build a market for solar photovoltaic and wind energy technologies almost from scratch.

The World Bank-supported renewable energy development program has enabled sales of over 402,000 PV solar-home systems (SHS) to rural families in remote areas of West and North-West China. About 1.6 million people who live in tents at least part of the year and who previously had little access to electricity, now have better light, communications and entertainment, with portable systems made to fit their semi-nomadic lifestyle.

The program supported China’s initiative to promote rapid growth of the PV industry, and helped improve quality of production while keeping costs low. Technical standards for PV components in China built on standards applied in other Bank and GEF-sponsored projects in Indonesia and Sri Lanka. The market for solar home systems rapidly expanded, and a network of suppliers, wholesalers and retailers was fostered. PV systems, concentrated initially on households, are now powering schools, health centers, village satellite telephones, forest protection, road maintenance, climate monitoring and Buddhist temples.

The Chinese government provided matching grants to PV companies eager to improve their business and marketing practices and improve the technical quality of their products. By the end of 2007, 34 participating companies had received nearly 400 grants worth $2.7 million, and matched them with their own investments. One company, Suntech (Wuxi Shangdu) received a grant in 2002 to develop an intelligent controller for PV systems. In 2006, it was listed on the New York Stock exchange and had placed among the world's top 10 PV cell manufacturers.

In 2004, China adopted the international standard for PV systems, required of all systems financed by the project. By helping to upgrade the quality of PV systems made in China, the project combined international technology advances with China’s proven low-cost production capabilities. Improving product standards and a competitive market have reduced by half the cost of PV systems in the country, and China has become a major exporter of world-class PV systems to other developing countries. The China Renewable Energy Development Project was recognized with an Ashden Award for Sustainable Energy in 2008.1


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