China WindPower Group Ltd., a Hong Kong-listed renewable energy company, will borrow as much as $240 million from the Asian Development Bank to develop wind farms in China to meet rising demand.
Proceeds of a $120 million dual-currency loan from ADB will be used to build and operate as much as 800 megawatts of wind-power projects mainly in the northeastern province of Jilin by 2013, according to a joint statement handed out to reporters in Beijing today. ADB has agreed to provide another loan of $120 million, they said.
China is tapping renewable energy like wind and solar power to reduce its reliance on fossil fuels, targeting to install 150,000 megawatts of wind turbines by 2020, according to the statement. China WindPower will increase its capital spending this year, from at least $900 million in 2010, to develop new plants, Chairman Liu Shunxing told reporters.
“We are very confident of our growth in China,” Liu said. “Every project that we operate is generating profits and that’s also why ADB wants to lend the money to us.”
China WindPower, listed in Hong Kong in 2007, operated 12 wind farms with a total capacity of 1,163 megawatts as of the end of last year, according to the company.
The loans from ADB will meet a “substantial” part of China WindPower’s financing demand and the company has no “immediate” plan to borrow more, Liu said.
The shares declined 12 percent in Hong Kong trading last year, compared with the 5.3 percent gain in the benchmark Hang Seng index. The stock fell 2.6 percent to 76 Hong Kong cents as of the midday break.
China WindPower is also considering solar power projects in the provinces of Gansu, Ningxia and Yunnan, Liu said, without elaborating.
“As advancements in technology reduce development costs, we see greater potential in solar than wind over the longer term,” according to Liu.