Chinese solar wafer manufacturer ReneSola won exclusive rights to develop a $706 million, 150-megawatt solar power plant in northern China, sending its share price sharply higher.The project, awarded by the Taiyangshan Development Zone near the city of Wuzhong, is subject to a feasibility study and government approval. The company expects to begin work on the four-year project in the Ningxia Hui Autonomous Region in 2010.
Winning the contract to develop the plant, whose 150 MW capacity equates to some of the larger wind farms operating in Europe and the United States, fits the company's strategy of branching out from its core business of solar wafer production.
A study by some of China's top climate change advisers published this week recommended setting firm targets to limit greenhouse gas emissions and ensure they peak by around 2030.
The company said last month it had signed a letter of intent with the Yancheng city government in Jiangsu Province to develop a 500-megawatt solar power generation project.
ReneSola has also winning contracts under China's Golden Sun project which offers subsidies for solar production, and that a hoped-for feed-in tariff would likely lead to a dramatic rise in demand for panels from private households.
Shares in ReneSola were up 19 percent at 176.5 pence by 1528 GMT, having earlier jumped to 182.5 pence. Thursday's rise means the stock has gained 5.5 percent so far this year, underperforming a 35 percent jump for the FTSE index of 100 leading shares listed on the AIM junior market.
Goldman Sachs upgraded the stock to "Buy" on Thursday and added it to its conviction list, pointing to ReneSola's cost structure and exposure to emerging economies.
SOURCE : REUTERS
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