The Landscape of Solar Industry in China 1

2 Landscape of Solar Industry in China  8 IPO’s since 2005,100+ solar fab’s built  In 2009, volume of polysilicon is ~49% of WW market, volume of solar cell is ~30% WW market  Ecosystem has been built up and tuned up Value chain covers polysilicon, wafer, solar cells, and solar PV modules. Infrastructure built up includes solar production equipment and materials.  Slowing down investments in polysilicon production capacity in light of WW over-supply seen in 2009.

3 Rapid and Massive Build Up of Polysilicon Production Capacity

4 Know Issues and Proposed Solutions  Known Issues Mobs mentality for investment in poly-si PV technology Over-capacity resulting in big loss in return on investment Outdated technology polluting the environment Lack of industry standards and the bilateral readiness for seamlessly tying solar power back to the existing grid  Proposed Solutions Effectively administering the solar energy industry with modern policies and regulations Deploying utility scale renewable energy farms near the population centers and executing the plans for rural electrification to support the off-grid population Establishing industry standards and actively guiding and administering the investment in technologies

5 Government Support to Solar Industry  Central government announced policy to support BIPV with subsidy of 20RMB/W in March of  Central government approved 10MW solar farm project in western China targeting 1.09RMB/KWh in June of  Central government announced support to Golden Sun Demonstration Projects in July of 2009 and committed up to 50% of investment in each of 257 approved projects ranging from 500KW to 50MW for a total capacity of 600MW.  Power companies in China started active acquisition of land for utility scale solar farms in 2009.

6 New Energy Stimulus in China  China to establish 15% renewable energy by  China to achieve 40-45% carbon reduction from 2005 level by  China to increase solar power capacity from 100MW in 2009 to 20GW by 2020, a 200X ramp in 11 years equivalent to ~61.82% annual compound growth rate (ACGR).  Central government to invest 3T+RMB in New Energy Industry (Nuclear, Wind, and Solar).  According to sources that central government will ultimately invest ~4.5T+RMB in stimulus and that will attract investment at the scale of ~9T+RMB from both the public and the private sectors.