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Well known for its vast wind and solar energy resources, Ningxia hopes to utilize its established equipment manufacturing industry to take advantage of the promising market for new energy equipment manufacturing in the region.

Thus far, Ningxia has already built two bases for new energy manufacturing in the economic development zones of Shizuishan and Yinchuan, and efforts have centered on manufacturing wind turbine generator systems and solar photovoltaic material.

CSMF Ningxia, Yinxing Energy and Zhongneng Ningxia are newly-formed enterprises that support new energy manufacturing by producing pedestals, tower tubes and fan blades.

In addition, solar photovoltaic material production has blossomed in Ningxia. Sunshine Silicon, China Power Group, and Rijing Electronics all have undertaken significant projects in the region.

Other solar energy projects have already been successful in Ningxia. A solar photovoltaic power generation project with annual capacity of 110,000 kilowatt was built and has generated power of up to 70,000 kilowatts, which is expected to reach 600,000 kilowatt by 2015, according to statistics from the Ningxia Development and Reform Commission.

However, the overall potential profitability for the industry might not be ideal, according to Wang Yongyao, head of the Economic and Information Commission of Ningxia (EICN).

"Although some Ningxia enterprises have gained advanced technologies in the production of fans and silicon polycrystals and application of solar energy, they are less competitive in global market due to insufficient investment in research and development," Wang said. "They are highly dependent on imports for some core technologies and equipment, which increases product cost and restricts the scale of production."

Wang said that most new energy equipment manufacturers are private enterprises, so they face difficulties in financing and lack support from financial institutions.

Ningxia Governor Wang Zhengwei said the government will invest 200 billion yuan ($30 billion) to foster emerging strategic industries over the next five years to boost the development of the industry.