First Solar Inc. has recently signed an agreement to construct a two-gigawatt solar energy plant in Ordos City, China. The solar project will be constructed in four stages, the first of which will be a 30-megawatt presentation unit.  Construction on the demonstration unit will commence in June 2010.  The supplemental three stages will be brought online between 2014 and 2019.  The accord calls for First Solar to provide solar arrays, engineering and construction for the 2-gigawatt facility.  Read more about Understanding the China Energy Market:Trends and Opportunities

The solar energy facility will function under the rules of China’s feed-in tariff platform. The solar project in Ordos will be constructed over a multi-year period. Stage 1 will be a 30 megawatt demonstration project that will begin construction by June 1, 2010 and be finished as soon thereafter as possible. Stages 2, 3 and 4 will be 100 megawatts, 870 megawatts, and 1,000 megawatts. Stages 2 and 3 will be finished in 2014 and stage 4 will be finished by 2019.

Moreover, First Solar, the world’s biggest producer of thin-film solar modules, will also help evolve China’s thin-film supply chain.  Mike Ahearn, CEO of First Solar, stated this deal highlights the efforts of the Chinese government to change their energy regulation:  “this major dedication to solar power is a direct consequence of the liberal energy policies being embraced in China to produce a sustainable, long-run market for solar and a low carbon future for China.”

The project will function under a feed-in-tariff which will assure the pricing of electrical energy developed by the power station over a long-run period.

The Chinese feed-in tariff will be vital to this project. This type of advanced government policy is essential to produce a strong solar market and facilitate the construction of a project of this size, which successively goes forward to drive the price of solar electrical energy closer to ‘grid parity’ – where it is competitive with conventional energy reservoirs.

The MOU signed with the Chinese government, reflects that during the execution of the first phases of the project First Solar will actively go over the theory of module and provider constructing sites in Ordos, and other circumstances involved to support a First Solar investment. First Solar also intends to facilitate enlargement of the supply chains in China for thin film photovoltaic module output and for the recycling of photovoltaic modules after utilization.