In 2012, the Ministry of Industry and Information Technology released a draft document titled "Guidance on Promoting the Healthy Development of the Solar Water Heater Industry." This policy signaled a clear direction for the solar thermal sector: by 2015, it aimed to cultivate three major companies with annual sales exceeding 300 billion yuan. These enterprises would lead in technological upgrades, consumer education, and industrial planning. Industry insiders believe this goal has become the ultimate target for the sector, prompting domestic solar thermal companies to strategically position themselves to become one of the top three industry leaders by the end of the Twelfth Five-Year Plan.
At the same time, the National Outline for Urbanization (2011–2020), developed by over ten ministries including the Ministry of Finance and the Ministry of Housing, was led by the National Development and Reform Commission. Though not officially released, the first draft outlined a vision for building more than 20 urban clusters, 180 prefecture-level cities, and 10,000 towns, with an estimated investment of 40 trillion yuan over the next decade. This plan is expected to significantly shape the future direction of the solar thermal industry, as companies are now closely aligning their strategies with China’s urban development goals.
Urbanization presents vast business opportunities. As the new driving force for China's economic growth, it also brings challenges related to energy demand and environmental pollution. The intersection between urban expansion and ecological sustainability highlights the growing potential for the new energy sector.
Li Jun, President of Four Seasons Mu Ge Group, noted that if China’s urbanization rate reaches 60% by 2020, approximately 10 million rural residents will move to cities annually. This shift will make cities and towns the primary battlegrounds for energy conservation, emission reduction, and green growth. Moreover, these new urban areas will serve as key platforms for building a “Beautiful China.â€
According to Li, urban migration will influence consumption patterns. Urban residents consume 3.5 times more energy annually than their rural counterparts, and their electricity usage is three times higher. Both urban and rural populations tend to be more conscious of energy use and open to adopting new energy technologies. He emphasized that local governments should prioritize the construction of eco-friendly housing, transportation, and consumption during the early stages of urbanization. However, he also pointed out that specific plans for integrating solar energy into urbanization remain unclear and need further clarification.
The academic community also supports the integration of solar energy with urbanization. Zhang Xiaode, Deputy Director of the Economics Department at the National School of Administration, stated that small towns and new energy have natural synergies, and solar energy should be a priority in urban planning. He explained that while fossil fuels are better suited for centralized use in large cities, new energy sources like solar are more evenly distributed and advantageous for smaller cities and rural areas.
China’s solar thermal industry is well-positioned for the development of new towns. With mature technology and global leadership in heat collection, solar thermal systems have broad application potential. Compared to wind, biomass, and tidal energy, solar thermal has a strong mass base. By 2012, the total installed area of solar water heaters had surpassed 200 million square meters. Each year, about 10 million new urban residents and 2 million families require new housing. If 100 million square meters of solar hot water and heating systems are adopted, the market potential would grow significantly.
Li Jun believes that urbanization will provide a broader platform for integrating solar energy with buildings, as well as for expanding solar hot water and heating projects in newly built or renovated public buildings. Compared to other clean energy sources, solar energy may take a leading role, and Muxi Song has already begun restructuring and strategic layout to capture this opportunity.
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