China’s National Development and Reform Commission will open a tender competition to select a project developer to constructing a massive solar power plain in the desert. The tender, which will open on on March 20 2009, will be for an on-grid 10MWp (megawatt-peak) solar photovoltaic power plant in Dunhuang of Gansu Province, northwestern China. It will occupying approximately one million square meters with total investment of an estimated 500 million yuan (US$73 million).

The National Energy Administration (NEA) will grant the project developer a franchise to operate the power plant for 25 years. 38 companies will be invited to tender for the project, including China Power Investment Corporation, China Huaneng Group, Suntech Power and Yingli Green Energy.

The China government in 2008 approved the construction of a solar power-generating station located on an offshore island in Shanghai and another located in Inner Mongolia, with a feed-in tariff rate of four yuan per kilowatt-hour for each. For this project, the China government will offer a feed-in tariff rate of below two yuan per kilowatt-hour, possibly as low as 1.7-1.8 yuan per klowatt-hour under intensive competition The large reduction in feed-in tariff is in response to largely decreased international prices of solar energy products since the fourth quarter of 2008.