Tuesday, November 17, 2009

First Solar, Ordos Mayor Sign Cooperation Framework Agreement

The First Solar project in Ordos, Inner Mongolia is massive, not only literally but also in terms of a step forward in US-China clean energy ties. Recently I heard NRDC's Barbara Finamore talk about the future of US-China cooperation on climate issues. NRDC has been working with First Solar on working out the details with the Chinese side. Barbara Finamore mentioned challenges such as intellectual property rights and rewards like First Solar benefiting from the feed-in tariff.

On 17 Nov 09, First Solar President Bruce Sohn and Mayor Yun Guangzhong of the Ordos City Government signed the Cooperation Framework Agreement as a key step forward for this project. Chinese Vice Premier Li Keqiang, Vice Minister Liu Qi of the National Energy Administration, and U.S. Secretary of Energy Steven Chu were all there. The Agreement between First Solar and Ordos spells out additional project details and local support that advance the development of the 2GW solar power plant and confirm the June 1, 2010 expected construction start date for the 30MW Phase 1. First Solar and Ordos also agreed to establish two committees to ensure the successful execution of the project and to develop a new energy industry in Ordos.

"This Cooperation Framework Agreement and its recognition by the National Energy Administration mark a critical step forward in the approval process for the Ordos project, one of the world's most ambitious renewable energy projects," said First Solar Chief Executive Officer Rob Gillette. "It reinforces the commitment of First Solar, the Chinese government, and the Ordos local government to make an immediate contribution to the development of a healthy solar industry in China and to the reduction of greenhouse gas emissions." The signing ceremony took place as part of the U.S.-China Summit where U.S.

"President Obama's trip to Beijing is a significant step forward in further solidifying bilateral relations with China. First Solar is enthusiastic in contributing to the commercial relations of our two countries through this Cooperative Framework Agreement," said Mr. Gillette.

"Solar energy will play a significant role in achieving China's low carbon future," said Yun Guangzhong, Mayor of Ordos City. "We are very pleased to be partnering with one of the solar industry's global leaders in a project of such significance." The 2GW First Solar project is to be built in multiple phases, beginning with the 30MW Phase 1. Phases 2, 3 and 4 are to be 100MW, 870MW, and 1,000MW, respectively. Phases 2 and 3 are to be completed by 2014 and Phase 4 is to be completed by 2019. The project is part of a planned 11.95GW New Energy Industry Demonstration Zone in Ordos City, Inner Mongolia. The New Energy Industry Demonstration Zone is expected to combine solar, wind, hydroelectric and biomass power sources to provide a steady supply of renewable energy to the region that includes the Chinese capital.

On 16 Nov 09, Mr. Sohn participated in a Clean Energy Roundtable with National Energy Administration Vice Minister Liu Qi, Energy Secretary Chu, Commerce Secretary Locke, U.S. Trade Representative Kirk and a small group of senior U.S. and Chinese business executives. During the high-level Roundtable, in which First Solar was asked to address the significance of renewable energy, Mr. Sohn told participants that China's vision and leadership in supporting solar energy and the Ordos project will "serve as a model of renewable power generation for the world. Projects such as Ordos will enable significant cost reductions through scale, and make solar a truly sustainable energy source in the near future. First Solar is committed to helping build a sustainable solar industry and low carbon economy in China by bringing advanced solar PV technology, global experience, and a focus on cost reduction and environmental sustainability." The Cooperation Framework Agreement sets forth the agreement in principle of the parties concerning the project and related activities. Final agreement between the parties is subject to the negotiation and execution of definitive agreements among the parties.

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