Canadian Solar, Guodian Power sign PV JV

Ontario’s Canadian Solar (Nasdaq:CSIQ) said today it entered into a strategic cooperation agreement with Beijing-based Guodian Power Development (SHA:600795), one of China's largest power generation companies.

The two said they plan to build and operate photovoltaic power plants in China, starting in Gansu, Ningxia, and Inner Mongolia and then expanding to other provinces.

Guodian Power is a subsidiary of the state-owned China Guodian, one of the five largest national power generation groups, with power plants in 29 Chinese provinces.

China Guodian's total installed capacity was 7,490 megawatts—including 6,687 MW of thermal, 471 MW of hydro, and 325.6 MW of wind power—by the end of June. The company wants to achieve 510 MW of installed PV capacity in China by 2012.

Canadian Solar is incorporated in Canada, but conducts its manufacturing operations in China (see Canadian Solar signs deals for 700 MW of wafers). It manufactures solar products such as ingots, wafers, solar cells and modules, as well as solar systems for customers worldwide, including a sales and distribution agreement in Spain and a supply contract in Germany (see Canadian Solar signs distribution agreement in Spain and Canadian Solar signs large supply contract with SolarWorld).

Canadian Solar said it is planning a ramp up in module production capacity of 820 MW this quarter to prepare for its production growth in China.

Under the agreement, the joint venture plans to first focus on building two grid-connected PV power plants in Ningxia. Guodian Power expects to hold majority interest in the projects, with Canadian Solar having first right to sell its modules and services to the joint venture at market pricing.