China's recently announced new Feed-In Tariff policy for photovoltaic power has boosted the building of new power plants.

Shanghai-based QS Solar announced on Thursday that the company will build distributed solar plants in two or three national development zones from 2014, to achieve annual power generation of 500 million KWh.

Sha Xiaolin, chairman of QS Solar, said his company will shift its focus from module production to construction of solar plants based on the encouraging incentive policy provided by the government.

China announced a new FIT policy in late August. For utility PV ground power, the new FIT has been set at 0.9 yuan (14 US cents), 0.95 yuan and 1 yuan per KWh based on solar radiation levels where the plant locates.

The distributed PV projects will get a subsidy of 0.42 yuan per KWh generated. The FIT, scheduled to last 20 years, will apply to all PV projects registered after Sept 1.

Analysts said the better-than-expected policy will be a catalyst that boosts the construction of solar plants.