Renewable Energy: Vital for China’s Future Energy Mix

• China’s booming economy means it is already the world’s second biggest consumer of energy, after the US. The country’s energy needs are set to double over the next decade.
• China is building the equivalent of two coal power plants every week and is the world’s third largest importer of oil.
• China’s Renewable Energy Law is far-reaching and ambitious, it mandates the state grid to purchase power from renewable energy projects, it also includes renewable tax-break policies of 50% and a renewable energy target of 15% of total by 2020.
• China is already a leading manufacturer of solar photovoltaics, second only to Japan. China ranks fifth in the world for wind turbine power and is set to add another 2/3 of capacity in 2008.

Investment Needed, but Reliable Information is Key

• China is still a market in transition and navigating the renewable energy sector is difficult; especially as it is an industry in which the government is heavily involved.
• Much of the renewable energy sector is both immature and poorly researched; firms find marketing themselves problematic. The chances for uncovering above average returns are high, it is possible to buy future market leaders early.
• Current financial conditions mean Chinese firms are unlikely to go for IPOs, but companies are seeking investment.
• US$398 billion investment is needed for China to meet its 2020 renewable energy goals.