Last week China announced a long-awaited plan to create subsidies for utility-scale solar projects, offering to pay for up to 50% of solar projects, as well as relevant power transmission and distribution systems for grid connections.
In areas where there is no grid-supplied power, the subsidy will rise to 70%. The Chinese government plans to install more than 500 megawatts (MW) of solar power in the next two to three years.
Solar shares have drifted upwards this year, as the market expected the Asian nation to announce its plan.
Chinese solar firms like Suntech Power Holdings Co Ltd (NYSE: STP), Yingli Green Energy Holding Co Ltd (NYSE: YGE) and Trina Solar Ltd (NYSE: TSL) saw their shares rise significantly following the announcement.
However, analysts warn the subsidy is not enough to correct for near-term oversupply in the sector.
Read the full Reuters report at the link below.
