United PV Enters into Strategic Cooperation Agreement with NARI Electricity under State Grid to Establish Joint Ventures and Jointly Develop and Construct 1.5GW Solar Power Plants

Hong Kong, China, 17 December 2014 - United Photovoltaics Group Limited (“United PV” or the “Company”, stock code: 00686.HK, whose largest shareholder is China Merchants New Energy Group “CMNE”), a leading solar power plant investor and operator in China, is pleased to announce today that, the Company entered into a strategic cooperation agreement with NARI Electricity Design Company Limited (“NARI Electricity”) under State Grid for the all-round collaboration on the development, construction and operation of solar power plants.

Pursuant to the agreement, the cooperation will cover: 1) the parties will engage each other as the preferred partners in the project design, development and construction of solar power plants; 2) the parties will cooperate in the remote controlling and smart management system for solar power plants that are being constructed and completed by the Company; 3) NARI Electricity will consolidate resource to develop and construct solar power plants earmarked for cooperation by the parties, and, upon completing such construction, the Company will acquire the solar power plants with an aggregate installed capacity target of not less than 1.5GW in the coming three years; 4) the parties will establish joint venture(s) to jointly develop and construct solar power plant projects, and upon completing the construction of which, the Company will acquire the shareholding in the joint venture(s) owned by NARI Electricity and settle the consideration by cash and/or securities of the Company at the discretion of NARI Electricity. Moreover, NARI Electricity may introduce other financial institution(s) to participate in the cooperation with the Company in the new energy industries. 

NARI Electricity, a wholly-owned subsidiary of Nanjing NARI Group Company (State Grid Electric Power Research Institute) [“NARI Group”, the holding company of two listed companies, NARI-tech (600406.SH) and Zhixin Electric (600517.SH)], is the business platform representing NARI Group to engages in the design, consultation and engineering contracting in the fields of electrical engineering and new energy in China and aboard. As a subsidiary research institute of State Grid Corporation of China, NARI Group is the largest supplier of equipment, service and integrated solution provider in of electricity system automation, hydropower automation, railway traffic monitoring in China. 

This will be the first time for State Grid’s subsidiary to establish a joint venture with a solar power plant operator. The powerful alliance between State Grid and China Merchants Group will bring demonstrative effect to China’s electricity planning in the future, integrate the state-own enterprise leaders’ resources and boost the groundbreaking collaboration amid China’s rapid growing solar power plant industry. With NARI Electricity’s network resources in State Grid and Electric Power Research Institute, in the future, the Company will be able to better fulfill the grid planning requirements in terms of electricity consumption, ensuring the investments are turned into stable cash flow quickly. Meanwhile, the cooperation on project development, technology sharing and operation management will help the Company to grow rapidly. 

Mr. LU Zhenwei, Managing Director of China Merchants Capital and Chairman of China Merchants Technology Holdings Co., Ltd, commented on the collaboration: “The strategic cooperation with NARI Electricity under State Grid marks another milestone after China Merchants Capital’s increase of shareholding in CMNE that recognized United PV’s position as the professional new energy business platform and the signing of cooperation agreements by United PV and China Merchants Logistics. We look forward to cooperating with strategic partners, such as State Grid, sister companies under China Merchants Group and Zhongli Sci-tech Group, to jointly build up a world-class new energy platform.”