The government of Minqin County in northwest China's Gansu province is battling desertification in the catchment of the Shiyang River, as overdevelopment has accelerated desert encroachment, leaving the basin among the country's worst ecologically-deteriorated regions.

In 2007, China put 4.79 billion yuan toward environmental conservation around the Shiyang River basin. Conservation efforts there have included capping water use and developing water-saving agricultural techniques.

"People are not only looking to increase their incomes, but have also demanded an improved environment and living standards," said Sun Wancang, a professor at Gansu Agricultural University.

Vice Premier Li Keqiang said last week China will invest 3.4 trillion yuan in environmental protection during the 12th Five-year Plan period.

Li vowed to expand domestic markets by encouraging the application of solar power generation technology and connecting more on-site solar power generation sites to the national power grid.

China has connected less than 10 percent of its annual solar cell output, indicating huge market potential, Li said, citing the solar sector as an example of how to tap local markets and explore ecological progress.

However, Chen Ying, secretary-general of the Research Center for Sustainable Development under the Chinese Academy of Social Sciences, said the promotion of ecological progress should come not only from the government, but also from enterprises and non-governmental organizations.

In east China's Jiangsu province, the provincial government has allocated 2 billion yuan annually to control pollution near Taihu Lake over the past five years.

In addition to the government's investment, a total of 75 billion yuan has been raised by the public to support more than 3,000 related projects.

Private enterprises in Jiangsu, represented by Suntech Power, the world's largest producer of solar panels, and Trina Solar, a leading solar module company, have contributed to China's solar capacity in recent years.

According to a report released by the National Energy Association on Sept 12, China will expand its installed solar power generation capacity to 21 gigawatts (GW) by 2015, which will require an investment of about 250 billion yuan.

In 2011, China's growth in renewable energy was 2.5 times that of Brazil and India combined. The country's asset financed investment of $44 billion in the sector represented 30 percent of global renewable investment, compared to Brazil's 5 percent and India's 7 percent, according to another report published by the Deutsche Bank Group in July.

The report forecast that China is likely to install 340 gW of renewable power in order to meet national targets through 2020. The investment in incremental wind and solar power, plus grid investment, could total $527 billion, it said.