The Asian Development Bank says it is supporting China’s efforts to cut greenhouse gas emissions and promote private investment in renewable energy by partly financing a $73 million wind farm in Inner Mongolia.

The ADB is extending a long-term local currency loan of up to $24 million to the project’s developer, Datang Sino-Japan (Chifeng) Renewable Power Corporation. It will be the first private sector wind farm in China to be financed by the ADB.

Inner Mongolia is considered a prime location for a medium to large-scale commercial wind power industry. The proposed 12 km2 wind farm in Chifeng City, Inner Mongolia, is expected to provide a steady source of electricity for the national power grid.

China has identified wind power as a commercially viable alternative to fossil fuels and the country’s wind power potential is estimated to be around 1000 GW, according to the ADB.

“The lack of finance on reasonable terms has held back the development of clean energy projects in the PRC,” said Hisaka Kimura, Investment Specialist with ADB’s Private Sector Operations Department. “This project could become a model for future collaborations between state owned enterprises and foreign investors in renewable energy projects, and may encourage the PRC’s private sector to invest in wind power projects.”

Datang Sino-Japan is a joint venture between state-owned China Datang Corporation and Japan’s Kyushu Electric Power Company, Sumitomo Corporation and Sumitomo Corporation (CHINA) Holdings. The partners say that the project will generate around 133 GWh per year and avoid carbon dioxide emissions of 140 000 tons per year.

China’s installed wind power capacity stood at around 12 GW in 2008.