United Photovoltaics Group, controlled by state-backed finance-to-logistics conglomerate China Merchants Group, aims to raise 10 million yuan (HK$12.7 million) through what it claims to be the world’s first megawatt-scale, off-power-grid solar farm project funded by an internet “crowd fundraising” platform.
The Hong Kong-listed firm has teamed up with Guodian Solar, the solar farm arm of state-owned power generator China Guodian, and online crowd-fundraising firm China Net Credit Finance.
China Net operates zhongchou.cn a website that raises money from individuals to fund new business and social ventures.
The first project will raise 10 million yuan for a one megawatt (MW) off-grid solar farm in Qianhai, Shenzhen. Qianhai is a special zone designated by the central government for pilot liberalisation of the financial industry, such as offshore yuan business.
“This is a landmark development for the solar power industry as it works together with the online finance sector for the first time to build the world’s first megawatt-scale, off-grid solar farm in Qianhai, at the forefront of China’s finance sector reform,” United said in a statement.
Although 1MW is a drop in the bucket compared to Beijing’s target for the mainland to add 14,000MW of installed solar farms this year, United chairman Alan Li Yuan said online crowd-fundraising had huge potential as a powerful project finance tool that would help fulfil its business and social responsibility objectives.
As a state-owned enterprise, China Merchants had to contribute towards achieving the air pollution control goals set by Beijing.
United has pledged to invest one million yuan in the Qianhai project, while six other firms – including other China Merchant units and state-backed power firms – have committed to invest 100,000 yuan each.
It is planned to raise the remaining 8.4 million yuan mainly from social “celebrities” to create publicity, with subscription limited to individuals who meet certain undisclosed qualifications.
After closing the Qianhai crowd fundraising deal in April, United plans to launch another project in Shanghai in the middle of the year, and more projects in other parts of the mainland in the third quarter.
Li declined to disclose the projects’ indicative return rates, but said they would be similar to similar projects in the United States. According to Mosaic.com a crowd fundraising platform for solar farms operated by US-based Solar Mosaic, most completed projects offered annual returns of 4.5 per cent to 5.6 per cent.