"This pioneering project will demonstrate how the PRC could leverage its indigenous solar resources to diversify its energy mix in a sustainable manner. With this comprehensive assistance package of low-cost financing, policy advice, and capacity development, we expect successful demonstration will lead to wider uptake of CSP plants in the PRC in the medium term," said Shigeru Yamamura, a Senior Energy Specialist at ADB’s East Asia Department.

The $150 million loan will help build a 50-megawatt power plant, which can generate 197 gigawatt-hours of clean electricity and cut 154,446 tons of carbon dioxide every year using a state-of-the-art renewable energy technology that converts direct normal irradiation into usable heat, generating medium- to high-temperature saturated steam that runs the steam turbine for power generation. This thermal cycle enabled the project to combine low-cost 7-hour thermal energy storage system allowing it to generate clean electricity even at night.

Qinghai province, which is located in a high plateau, is currently ranked first in solar power capacity concentration throughout the PRC. It has more than 2 gigawatt (GW) of solar photovoltaic installed capacity, which is more than 60% of the national capacity. The project site is located in a cold climate where mid-winter minimum temperature could fall overnight to -27 degree Celsius. This is the first application of CSP plant in such low winter temperatures.

ADB has been promoting CSP in the PRC since 2009, with a grant that helped lower the barriers for building utility-scale demonstration project. The Government of the PRC has since announced a target of 1 GW of CSP capacity by 2015 and 3 GW by 2020. CSP development has been rather slow, however, primarily due to limited hands on in-country experience.

By demonstrating utility-scale CSP plant in a solar rich province, the project will significantly reduce remaining barriers, enabling rapid deployment of CSP technology. ADB estimates that, if timely deployed, CSP plants can provide up to 15% of the PRC’s electricity by 2040.

The project will be jointly financed with China General Nuclear Power Corp. and the Export-Import Bank of China.